Sembcorp JV sells 30% stake in Sichuan innovation park developer for S$138.8m

A JOINT venture of Sembcorp Industries has agreed to sell a 30 per cent equity interest it holds in Sino-Singapore (Chengdu) Innovation Park Development Co (SSCIP) worth RMB 691.3 million (S$138.8 million), the mainboard-listed company said in an exchange filing on Wednesday. (see amendment note)

The agreement was entered into by Singapore-Sichuan Investment Holdings (SSIH), a joint-venture company of Sembcorp Development, the urban business of Sembcorp Industries.

The stake will be sold to Chengdu High-tech Investment Group, Sembcorp said.

Once the disposal is completed, SSIH's share in SSCIP will be reduced to 20 per cent from the original 50 per cent.

Sembcorp said the selling price includes a 22.6 per cent premium over the original cost of investment and has factored in SSIH's cost of funds in China.

The net asset value was approximately RMB 564 million (S$112.8 million) as at last Dec 31, it said.

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The consideration is expected to be received in cash in tranches and in full by March 31, 2021, although the disposal is expected to be completed by the end of this month.

Sembcorp Development, which owns half of SSIH, will gain S$11.5 million from the disposal while maintaining a 10 per cent effective equity interest in SSCIP.

According to the filing, SSIH is incorporated in Singapore and has held a 50 per cent stake in SSCIP since 2012. SSCIP is the master developer of the 1,000-hectare Singapore-Sichuan Hi-tech Innovation Park in Chengdu, China.

Sembcorp Industries fell S$0.02 or 1.11 per cent to close at S$1.78 on Wednesday.

Amendment note: An earlier version of this article stated that a subsidiary of Sembcorp Industries had agreed to sell its 30 per cent stake in Sino-Singapore (Chengdu) Innovation Park Development. It is in fact a joint venture.