Temasek drops S$4.1 billion bid for Keppel after conglomerate reports steep loss

Temasek drops S$4.1 billion bid for Keppel after conglomerate reports steep loss

Keppel building
File photo of Keppel building in Singapore on May 24, 2018. (Photo: REUTERS/Edgar Su)

SINGAPORE: Singapore's Temasek Holdings is terminating its S$4.1 billion conditional offer for conglomerate Keppel Corp by invoking a material adverse change (MAC) clause following the company's poor financial results.

After Keppel reported a large second-quarter loss that breached a threshold in the state investor's offer to buy control of the company, Temasek had said it would make a decision by Aug 31.

Temasek's decision to drop the bid is likely to surprise markets as analysts had expected Temasek to lead consolidation in the rig-building sector after taking majority control of embattled Keppel.

"The offeror has decided that it will invoke the MAC pre-condition, and accordingly, is announcing today that the partial offer will not proceed," a holding company of Temasek said in a Singapore bourse statement on Monday (Aug 10).

Last October, Temasek offered to increase its one-fifth stake in Keppel to 51 per cent.

Keppel, whose businesses range from property development to rig-building, swung to a net loss of S$697 million for April to June, from a net profit of S$153 million a year earlier – its biggest quarterly loss in at least 15 years, Refinitiv data showed.

Source: Reuters/dv

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