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Keppel's China marina divestment remains stalled amid legal battle

KEPPEL Corp's planned 2.9 billion yuan (S$590 million) disposal of its stake in a China marina project remains stalled as the project's minority shareholder continues to try to block the deal.

Keppel, a conglomerate with interests in property and rigbuilding, said that the Singapore High Court has granted an application by Sunsea Yacht Club (Hong Kong) Co to prevent Keppel from completing the sale pending Sunsea's application with the Court of Appeal.

Sunsea Yacht Club owns 20 per cent of Keppel Cove, a residential and marina development in Zhongshan City, China. Keppel's Keppel China Marine Holdings, which Keppel is attempting to sell to Hong Kong-listed Logan Property, owns the remaining 80 per cent.

Sunsea started legal action in November to block Keppel's sale. On Dec 15, the Singapore High Court dismissed Sunsea's summons for interim relief to prevent the sale from happening. On Dec 22, Sunsea sought the High Court's permission to appeal against the dismissal of the summons for interim relief, but was denied by the High Court and ordered to pay costs.

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But Sunsea told the High Court that it plans to go to the Court of Appeal to appeal the Dec 22 decision. The High Court has therefore allowed an application by Sunsea to restrain Keppel from completing the divestment until Sunsea's application with the Court of Appeal has been addressed by the higher court.

If the deal goes through, Keppel will be able to recognise a gain of about S$290 million.

Separately on Monday, Keppel said that it has clinched a government land tender to buy a prime 18.03 hectare residential site in Wuxi, China for 2.53 billion yuan (S$517 million).

Keppel's Keppel Land China unit plans to develop the site, which has a gross floor area of about 360,500 square metres, into a residential project with 2,053 high-rise, 456 mid-rise and 246 low-rise units. The project sits five kilometres from Wuxi's downtown area, close to the Sunan Shuofang International Airport and Wuxi railway station.

"With Wuxi's strong economic growth and positive residential market outlook, coupled with the prime location of the site in close proximity to amenities, we are confident that the new residential development will receive strong demand from homeowners looking for quality, thoughtfully designed homes with strong value propositions." Keppel Land chief executive Ang Wee Gee said in a statement.