Thursday, February 13, 2020

Keppel associate drops merger bid to create offshore housing giant

SINGAPORE – Keppel Corp said on Friday (Feb 14) that its associate company Floatel International and Oslo-listed Prosafe have dropped their bid to merge in a combination that would have created the world’s largest offshore accommodation provider.

The decision comes after Norway competition authorities blocked the proposed merger in October 2019. Keppel had said then said that Floatel and Prosafe were assessing whether to appeal the decision.

In a regulatory update on Thursday (Feb 13), Keppel said Floatel and Prosafe “were of the view that any near-term completion of a value-enhancing merger was unlikely”.

The merger would have combined Prosafe’s existing nine semi-submersible vessels, and options for two newbuild semi-submersible vessels with Floatel’s five semi-submersible vessels, Prosafe said in an announcement at the time.

Keppel said the discontinuation of the proposed deal is not expected to have a material impact on its net tangible assets or earnings per share for the current financial year.

Keppel Offshore & Marine, a unit of the Keppel Corp, owns a 49.92 per cent stake in Floatel via its wholly-owned subsidiary Fels Offshore.

Fels Offshore’s resultant shareholding in the post-merger Prosafe would have been about 22 per cent.

Keppel shares were trading up one cent or 0.15 per cent at $6.74 at 10:30am on Friday.

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