Keppel Corp 02 (Jan 15 to Dec 24)

Re: Keppel Corp

Postby behappyalways » Sat Aug 01, 2020 5:10 pm

Impairment of $930 million causes $537 million net loss for Keppel Corp in 1H2020, calls into question Temasek’s partial offer
https://www.theedgesingapore.com/views/ ... s-question
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Re: Keppel Corp

Postby winston » Mon Aug 03, 2020 10:28 am

not vested

Keppel Corp (KEP SP)
2Q20: Larger-than-expected Impairments


KEP reported a 2Q20 loss of S$698m due to larger-than-expected impairments of S$919m, resulting in one of the MAC clauses within the Temasek partial offer being triggered.

Should the three inter-conditional resolutions at the SCI and SMM EGM (slated for 11 August) be passed, we expect Temasek to waive the MAC clause and revise down its partial offer.

Excluding impairments, KEP’s 2Q operational results were largely in line.

Maintain BUY. Target price lowered slightly to S$7.10.

Source: UOBKH

https://research.uobkayhian.com/content ... 526d9931fb
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Re: Keppel Corp

Postby helios » Mon Aug 03, 2020 11:41 am

Agreed. Price shall be revised.
Just bought some more Keppelcorp @ 5.18.
Will exit all soon near end Aug OR hold till Oct period.
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Re: Keppel Corp

Postby winston » Mon Aug 03, 2020 1:23 pm

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Keppel Corporation (KEP SP) - All eyes on Temasek now

Keppel Corporation saw a S$697.6m net loss in 2Q20, mainly due to significant impairments in the Offshore & Marine segment, such as the provision for contract assets and doubtful debts.

With this, the 20% threshold in the MAC clause for Temasek’s pre-conditional partial offer in respect of net profit after tax has been crossed, which means that the MAC pre-condition is not satisfied as of 31 July.

Temasek has the right to waive its pre-conditions but if it walks away from the deal, there would be a negative knee jerk reaction on the share price and traders could eye recent trough levels of S$4.82 in March 2020 and S$4.70 in early 2016 during the last oil crisis.

All this is happening around the same time that SCI and SMM are having their own proposed restructuring which also involves Temasek (the EGM date for SCI and SMM is on 11 Aug).

Looking ahead, the O&M division will face very challenging conditions and we believe that bold restructuring is needed.

The Covid-19 pandemic has also highlighted the industry’s heavy reliance on foreign labour and some re-thinking may be required for more sustainable operations.

An interim cash dividend of S$0.03/share has been declared, vs. S$0.08/share a year ago. BUY.

Source: OCBC
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Re: Keppel Corp

Postby winston » Wed Aug 05, 2020 2:01 pm

Likely lower offer from Temasek

Cleaning up the balance sheet.

KEP reported a massive S$698mn loss in 2Q20, mainly due to S$919mn of impairments of its O&M assets.

2Q20 net profits excluding the impairments was commendable, surging +45% YoY to
S$222mn.

Will Temasek bite? We believe Temasek will continue ahead with the partial offer for KEP, but with a lower revised offer price in light of the recent turn of events.

Maintain OUTPERFORM with the lower target price of S$6.34, based on SOTP valuation.

Source: KGI
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Re: Keppel Corp

Postby winston » Wed Aug 05, 2020 2:07 pm

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Is there a need to kitchen-sink?

KEP took in c.S$889m of O&M impairment in 2Q20, resulting in loss of S$699m. This caused a breach of the MAC clause for Temasek’s partial offer.

Temasek can:-
1) issue a waiver to keep the offer
2) walk away from the deal due to the breach or
3) seek approval from SIC and review the offer price.

Our SOP TP is cut to S$6.46, to reflect lower O&M book value.

Catalyst: Temasek partial offer remains.

Risk: unexpected order cancellations.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 2FB6AEB161
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Re: Keppel Corp

Postby winston » Thu Aug 06, 2020 12:15 pm

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Will Singapore take over Keppel and merge it with Sembcorp Marine?

Shareholders in Singapore's pride, the hard-strained Keppel Fels shipyard, will have to wait to find out whether the island state's investment company Temasek will become majority shareholder.

Perhaps they are waiting for Sembcorp's decision to spin off its marine division. This will happen next week.

Source: Shipping Watch

https://shippingwatch.com/suppliers/article12323326.ece
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Re: Keppel Corp

Postby winston » Mon Aug 10, 2020 4:31 pm

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Temasek will not proceed with partial offer for Keppel Corp

On Aug 10, Temasek Holdings announced it has decided that it will invoke the material adverse change (MAC) pre-condition, and accordingly, the Partial Offer will not proceed.

The Securities Industry Council of Singapore has confirmed that it has no objection to the Offeror withdrawing the Partial Offer by invoking the MAC pre-condition.

On July 30, Keppel Corp announced that its profit after tax (PAT) in 2Q2020 was a negative $698.8 million, and the cumulative PAT for the latest 12 month period is a negative $164.7 million.

In October last year, Temasek Holdings announced a partial offer for Keppel Corp at $7.35 per share in order to raise its stake from 20% to 51%, under certain pre-conditions.

Among the MAC pre-conditions is for PAT for a 12 month period to be no less than $556.9 million.

If the MAC pre-condition is to be assessed on 2Q2020 results, the MAC pre-condition would not be satisfied, a recent Keppel Corp announcement says.

On Aug 1, Keppel Corp announced that Temasek Holdings would disclose as soon as it makes a decision, and no later than Aug 31, if the latter intends to invoke the material adverse change (MAC) clause in its partial pre-conditional offer for Keppel Corp.

Separately, Sembcorp Marine (SMM) and Sembcorp Industries (SCI) EGM will be held 10am / 11.30am on Aug 11.

*We don't think the Keppel deal falling through will affect the Sembcorp proposals. SMM needs the lifeline right issue and SCI demerging SMM allows both companies to stay focused on their respective businesses," says a DBS Research note.

Keppel Corp closed at $5.40 on Aug 7.

Source: The Edge

https://www.theedgesingapore.com/news/m ... eppel-corp
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Re: Keppel Corp

Postby winston » Tue Aug 11, 2020 8:32 am

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No deal for Keppel: Mixed views on what this means for O&M consolidation

Timing of Temasek's withdrawal from S$4 billion partial offer, well ahead of Aug 31 deadline, also surprises many market watchers

by SHARANYA PILLAI

Before Temasek's withdrawal, some market watchers were still cautiously optimistic that Keppel would keep the deal on the table, albeit at a lower price than the earlier announced S$7.35 per share for an additional 30.55 per cent stake.

Despite Temasek's withdrawal, the rough consensus still seems to be that Keppel O&M and SMM will eventually merge as industry headwinds worsen. But the question of when this marriage will happen has become more uncertain.


Source: Business Times

https://www.businesstimes.com.sg/compan ... solidation
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Re: Keppel Corp

Postby winston » Tue Aug 11, 2020 11:50 am

Keppel Corp (KEP SP)
Disappointingly, Temasek Withdraws Partial Offer – But Not All Is Lost


Temasek announced that, pursuant to KEP’s poor 2Q20 results that were affected by nearly S$1b in impairments, it will invoke the MAC pre-condition and thus withdraw its partial offer for KEP.

We had expected a decision after, not before the SCI-SMM EGM on 11 August.

We point out that nothing stands in the way of Temasek coming back to the table with a revised offer in the next 6-12 months.

Maintain BUY. Target price lowered to S$6.70.

Source: UOBKH

https://research.uobkayhian.com/content ... 88a09a20ee
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