The proposed merger between Keppel Offshore & Marine and Sembcorp Marine has been delayed until the end of April 2022 at the earliest.
Both companies said they are devoting “considerable resources” to progressing the combination but added that “more time and deliberation” will be required.
Outstanding issues are said to include the completion of due diligence, reaching a mutual agreement on the transaction terms, and finalising definitive legal documentation.
Keppel and Sembcorp first announced the proposed merger in June 2021 and initially had hoped to have the matter resolved by the first quarter of 2022.
However, the two companies did say “significant progress” has been made, including the transaction structure, exchange ratio and other related matters.
Keppel said the proposed combination is designed to create a stronger combined entity, leveraging respective strengths to realise synergies and deliver sustainable value over the long term for shareholders.
The tie-up between Keppel and Sembcorp is among several mergers between Singapore’s major state-linked companies as they adjust to a world of disruptive technology and climate change.
Despite the recent rally in oil prices, both Keppel and Sembcorp have been increasingly pivoting towards the high growth renewables and clean energy segments.
Separately, Keppel Corp said “significant progress” has also been made on advancing the sale of Keppel Offshore &Marine’s legacy rigs and associated receivables to a separate company that would be majority owned by external investors. However, it gave no further details.
