Keppel, SPH merger a good deal for both: UOB Kay Hian

Keppel is set to fully acquire SPH’s non-media businesses by end-December if shareholders approve.

Keppel’s proposed acquisition of SPH, excluding the latter’s media business, would benefit both companies, according to a brokerage report from UOB Kay Hian.

In our view, Keppel’s proposed acquisition of SPH is a good deal for its shareholders as it gives the company exposure to assets that it currently does not have, especially the Purpose Built Student Accommodation, whilst expanding its foothold in its three key business segments – asset management, urban development, and connectivity. Asset management, in particular, could witness a 27% increase in assets under management to c.S$47b,” UOB Kay Hian Analyst Adrian Loh said for Keppel Corp.

UOB Kay Hian Analyst Lucas Teng added that SPH should accept Keppel’s offer.

“The offer price of S$2.099/share is approximately 5% above our previous target price of S$2, which appears to be fair. We think valuation could be slightly higher, but not by much,” Teng said.

He added that SPH’s student accommodation assets in the UK would be appealing to Keppel, as it is resilient to the effects of COVID-19 due to the rising domestic student population.

The acquisition would also avoid a scenario where SPH’s assets are cherry-picked, leaving the company with debt and the risk of monetising what is left.

The deal is set for completion by end-December, subject to the approval of shareholders.

Follow the link s for more news on

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Exclusives

Lorem Ipsum Singapore Business Review
The text to display in the title bar of a visitor's web browser when they view this page. This meta tag may also be used as the title of the page when a visitor bookmarks or favorites this page, or as the page title in a search engine result. It is common to append 'Singapore Business Review' to the end of this, so the site's name is automatically added. It is recommended that the title is no greater than 55 - 65 characters long, including spaces.The text to display in the title bar of a visitor's web browser when they view this page. This meta tag may also be used as the title of the page when a visitor bookmarks or favorites this page, or as the page title in a search engine result. It is common to append 'Singapore Business Review' to the end of this, so the site's name is automatically added. It is recommended that the title is no greater than 55 - 65 characters long, including spaces.
Agribusiness
Lorem Ipsum 2
Contrary to popular belief, Lorem Ipsum is not simply random text.