Keppel Telecommunications & Transportation (Keppel T&T) has entered a deal to divest all of its stake in Keppel Logistics to Geodis International SAS for around S$80 million, Keppel Corp. said in a filing with the Singapore Exchange in March.
The deal values Keppel Logistics at an enterprise value of S$150 million on a cash-free, debt-free basis, the filing said.
The transaction includes Keppel Logistics’ businesses in Singapore, Malaysia and Australia, and UrbanFox, but excludes Keppel T&T’s logistics operations in China and also excludes its stakes in Keppel Puninar Logistics in Indonesia and Indo-Trans Keppel Logistics in Vietnam, the filing said.
“The divestment of Keppel Logistics, a non-core business that has been operating at a sub-scale level, is in line with the Keppel Group’s Vision 2030 plans to simplify and focus our business as well as enhance our earnings,” Thomas Pang, CEO of Keppel T&T, said in the statement.
“Following the divestment, Keppel T&T’s priority would be to scale up in our focus areas of sustainable data center solutions and subsea cable systems. The transaction will also unlock capital that can be deployed to fund the Keppel Group’s growth initiatives,” Pang said.
Around S$70 million of the consideration will be payable in cash on completion, with the remaining S$10 million to be placed in escrow to be released when performance targets are met in 2022 and 2023, the filing said.
The deal is expected to be completed in the second quarter of this year, conditional on regulatory approvals, the filing said.
In addition, Keppel Logistics has signed a non-binding term sheet to divest its 51 percent stake in Indo-Trans Keppel Logistics (ITKL) in Vietnam to In Do Trans Logistics Corp., the existing joint venture partner in Vietnam, the filing said.
Keppel T&T will continue to seek ways to monetize the remaining non-core logistics assets and operations, the filing said.