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KepLand privatisation not predicated on short-term recovery of property sector: KepCorp CEO
KEPPEL Corp's planned takeover and privatisation of its 54.6 per cent subsidiary, Keppel Land, is not predicated on the expectations of a quick recovery of the property sector, chief executive officer of the diversified marine conglomerate said.
Loh Chin Hua told analysts and the media on Friday that KepCorp's cash offer for the remaining shares of KepLand was because it believes the investment is "sound and well-timed''. He added that the move had been "deliberated for a while'' and will be immediately accretive for shareholders.
"This is not a decision we are taking because we believe the property market is going to recover tomorrow,'' Mr Loh said. "But we believe this is the right move for KepCorp in the long term.''
Mr Loh also assured investors that KepCorp will still be able to look at other potential opportunities after this.
Assuming full acceptance of the offer, KepCorp's earnings per share for FY2014 will increase 13 per cent to S$1.18 from S$1.04. Its net asset value will rise by 4 per cent to S$10.77 billion from S$10.38 billion.
Earlier, KepCorp made an offer to buy the rest of KepLand at S$4.38 a share but will raise the offer price to S$4.60 a share if it can exercise its rights of compulsory acquisition.