Keppel seeks to unlock value for S$3-5 billion of assets over next 3 years

KEPPEL Corporation has identified assets valued at S$17.5 billion that can be "monetised over time and channelled towards growth initiatives". It will seek to unlock value for S$3 billion to S$5 billion worth of these assets over the next three years.

Speaking at a media and analyst briefing to reaffirm the company's Vision 2030 roadmap, Keppel CEO Loh Chin Hua said these assets include landbank, non-core assets such as oil rigs, and funds. Their values are based on the group's balance sheet as at end-June.

Shares of Keppel closed at S$4.30 each on Tuesday, giving the group a market capitalisation of S$7.5 billion.

The assets identified for monetisation do not include Keppel's business platforms or fixed assets, such as its offshore and marine (O&M) yards or its trust holdings. But Keppel said it will commence a strategic review of the O&M business.

The company said that it is now exploring both organic and inorganic options amid the sector's "challenging environment". A slump in oil prices has weighed on the global oil and gas industry.

While unwilling to disclose specific details, Mr Loh said that "all options are available to the group" - including the highly-speculated merger of Keppel O&M with rival Sembcorp Marine, as well as a complete divestment of the segment.

Organic options include reviewing the strategy and business model of Keppel O&M, assessing its current capacity and global network of yards and restructuring to seek opportunities as a developer of renewable energy assets; while inorganic options would range from strategic mergers to disposal.