Higher oil prices a positive in merger of Keppel O&M and Sembmarine

KEPPEL Corporation and Sembcorp Marine (Sembmarine) have named Apr 30 as the date by which investors could see a definitive agreement on a potential merger of Keppel Offshore & Marine (Keppel O&M) with Sembmarine. Since providing this update on Mar 31, both companies have seen their shares rise even as the benchmark Straits Times Index fell.

Investors have good reason to be excited. Much has changed over the 9 months since Keppel and Sembmarine revealed they were giving the merger of their pandemic-hit O&M operations a fresh stab.

Recall that in 2001, Keppel and Sembcorp Industries, then Sembmarine's parent, had said they were in talks for a possible rationalisation, but had quickly ditched the idea as they couldn't see eye to eye on terms.