Keppel unlocks $104 million with divestment from Palm City
Keppel unlocks $104 million with divestment from Palm City
Keppel Ltd has divested its entire 42 per cent stake in South Rach Chiec City LLC (SRC), the developer of Palm City in Ho Chi Minh City, according to a statement released on April 1.
Vietnamese real estate company Gateway Thu Thiem JSC (GWTT) purchased the stake, unlocking total cash proceeds of VND2,612 billion (about $104 million).
The proceeds include a cash consideration of VND1.702 triillion (about $68 million) for the 42 per cent equity stake, taking into account the adjusted net asset value of Keppel’s stake as of March 4 based on the agreed value of the Palm City development attributable to the shares.
According to Louis Lim, CEO of Real Estate at Keppel Ltd., the divestment from Palm City is another step forward in Keppel’s ambitious plan to monetise a cumulative S$10-S$12 billion ($7.4 to $8.9 billion) in assets by the end of 2026.
“This move demonstrates Keppel’s continued execution of our asset light strategy despite the challenging market. Since embarking on our asset monetisation programme in October 2020, we have announced the unlocking of about S$7.1 billion ($5.3 billion) in assets from our balance sheet, excluding businesses such as Offshore & Marine,” said Lim.
In connection with the divestment, Keppel has also assigned 840,000 bonds issued by SRC to GWTT for a consideration of VND910 billion (about $36.4 million), which is equivalent to the face value of the bonds and accumulated bond interest up to March 31.
Palm City is a 30-hectare integrated township located in District 2 of Ho Chi Minh City. The first two residential phases, Palm Residence and Palm Heights, were completed and handed over in 2017 and 2019, respectively. There are four remaining plots in the project – two residential plots, a mixed-use plot, and a medical plot.
Palm City project in Ho Chi Minh City developed by Keppel. Photo: Trong Tin |
Over the years, Keppel has recognised cumulative profits after tax of approximately S$24.6 million ($18.3 million) from the sales of residential units at Palm City, prior to the divestment. The divestment, which was completed in March, will result in a net divestment profit of approximately S$55 million ($40.9 million) for Keppel.
The transaction is not expected to have any material impact on earnings per share or net tangible assets per share for Keppel this financial year.
Keppel Ltd is a global asset manager and operator with strong expertise in sustainability-related solutions spanning infrastructure, real estate, and connectivity.
Headquartered in Singapore, Keppel operates in more than 20 countries worldwide, providing critical infrastructure and services for renewables, clean energy, decarbonisation, sustainable urban renewal, and digital connectivity.
Keppel creates value for investors and stakeholders through its quality investment platforms and diverse asset portfolios, including private funds and listed real estate and business trusts.
- 10:22 02/04/2025
