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Keppel Corp charts plan for new decade to 2030

KEPPEL Corporation is drawing up a plan for the new decade leading up to 2030, one that may involve shedding non-core businesses, according to chief executive Loh Chin Hua's New Year message to employees on Wednesday.

An exercise involving about 30 younger business leaders from Keppel was held in the just-concluded year to chart the vision for the group.

Contrasting ideas were presented, but there were also "significant areas of convergence", such as the need to focus and build on core strengths, divest non-core businesses, tap third-party funds for growth, and build an agile organisational culture, he wrote.

"We will take on board these ideas as we chart the company's 2030 vision, with interim targets for 2025," said Mr Loh in the letter sent to all of the conglomerate's directors and staff.

More details on the new roadmap are to be shared later this year. The group had an average of more than 18,000 employees in 2018.

This comes as Temasek seeks to raise its stake in Keppel in a move that would give the state investment firm control. 

A few months ago, Temasek, through its wholly-owned subsidiary Kyanite Investment Holdings, made an offer to acquire an additional 30.55 per cent of Keppel shares at S$7.35 apiece in cash.

If successful, the S$4.08 billion deal will raise Temasek's and Kyanite's total holding in Keppel to 51 per cent, on top of Temasek's current, direct 20.45 per cent interest. 

Temasek has said it intends to keep the Mainboard-listed Keppel on the Singapore Exchange, but would seek to undertake a strategic review of Keppel's businesses, the results of which may include refocusing on and strengthening certain businesses, and/or potential corporate actions.

While Mr Loh was unable to comment on the offer, he said that there is "inherent long-term value in Keppel's businesses”, echoing Temasek's words when it announced the offer.

"As always, we will endeavour to deliver value for all our stakeholders," he wrote. 

According to the missive, sustainability will also be a "key consideration" in Keppel's investment decisions. It has set targets to invest in renewable energy generation.

In addition, the group is moving away from highly polluting businesses such as coal and towards renewables and cleaner energy such as gas. Already, renewables and LNG-related solutions made up close to 60 per cent of new orders secured in 2019, Mr Loh noted. 

Keppel will also start tracking Scope 3 carbon emissions from this year. It has been tracking and reporting on Scope 1 and 2 emissions since 2010.

Separately, Mr Loh also shared that Keppel had zero fatalities across its global operations in 2019, the first time the group has achievedthe target in over 25 years.