Keppel to divest its logistics businesses for $80m

This transaction includes Keppel Logistics' businesses in Singapore, Malaysia and Australia.

Keppel Telecommunications & Transportation (Keppel T&T) has agreed to the divestment of its entire stake in Keppel Logistics to Geodis International SAS (GEODIS) for a consideration of approximately $80m, valuing Keppel Logistics at an enterprise value of $150m on a cash-free, debt-free basis. This transaction includes Keppel Logistics' businesses in Singapore, Malaysia and Australia, as well as UrbanFox.

Keppel T&T CEO Thomas Pang said, "The divestment of Keppel Logistics, a non-core business 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. Following the divestment, Keppel T&T's priority would be to scale up in our focus areas of sustainable data centre solutions and subsea cable systems. The transaction will also unlock capital that can 
be deployed to fund the Keppel Group's growth initiatives."

Approximately $70m of the consideration will be payable in cash on completion, and $10m will be placed in an escrow account to be released to Keppel T&T upon the fulfilment of certain performance targets in 2022 and 2023. The completion of the proposed divestment is expected to take place in the second quarter of 2022, conditional upon, among others, the receipt of approval from the applicable regulatory authorities.

The consideration was arrived at on a willing buyer and willing seller basis, taking into account the enterprise value, financial position and business prospect of Keppel Logistics.

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