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Keppel looking into possible transaction involving Keppel T&T interest; also considering M1 stake with SPH

KEPPEL Corp is considering a potential transaction of its stake in logistics and data centre arm Keppel Telecommunications & Transportation (Keppel T&T) and has asked Singapore Press Holdings (SPH) to take part in a possible transaction involving their stakes in listed telco M1, according to filings with the Singapore Exchange on Monday morning.

No specific deal terms were announced.

There is no certainty or assurance that any transaction will occur, Keppel Corp and SPH said in concurrent announcements.

Keppel Corp, a conglomerate whose businesses include rigbuilding and real estate, held a 79.2 per cent stake in Keppel T&T as at March 5, 2018. Through Keppel T&T, Keppel also holds interests in Keppel DC Reit, a data centre trust, and M1, Singapore's third largest telco.

Based on Keppel T&T's closing price of S$1.36 on Friday, Keppel Corp's stake is worth about S$602 million. Trading in Keppel T&T was halted on Monday.

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Keppel T&T controlled a 19.33 per cent stake in M1 as at Feb 22, 2018, while SPH, a media and property group that also owns The Business Times, held a 13.45 per cent stake. Based on M1's close of S$1.63 on Friday, Keppel T&T's stake in M1 has a market value of S$292 million, while SPH's has a market value of S$203 million. Trading in M1 shares was halted on Monday.

Malaysian telco Axiata Group, with a 28.7 per cent stake in M1, was the Singapore telco's largest single shareholder.

In March 2017, SPH, Keppel T&T and Axiata jointly appointed Morgan Stanley Asia as a financial adviser to undertake a strategic review of their stakes in M1, with a view to a possible sale. In July that year, the three parties decided not to proceed further with the review, saying that proposals from interested parties did not meet their minimum criteria and parameters despite a favourable level of interest. No arrangement or agreement with any third party was reached at that time.

Keppel Corp changed hands at S$7.02 as at 9.15am on Monday, down 0.1 per cent or 1 Singapore cent, while SPH stayed unchanged at S$2.82. Keppel T&T closed on Friday at S$1.36, and M1 at S$1.63.

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