Keppel Corporation

[CY09]

Hi shiyi,

Keppel allocated 500 million sing dollars to buy back shares. It used up the full amount which only amounted to 4% of its share base

[CY09]

Good news for shareholders, should the merger of KOM go through, shareholders will be looking at a gain of $3.4 billion over the current value of the assets in the balance sheet.

https://links.sgx.com/FileOpen/MREL_1.%2...eID=745558

Based on a full year result, KOM is only generating $88 million in net profits, with cash generation ability of $115 million. A sale of any amount above $3 biillion is definitely accretive to Keppel Shareholders (but definitely not to sembcorp marine sharheolders)

[specuvestor]

Singapore property behemoth and asset manager Keppel Corp. will unwind its conglomerate structure in a move to increase its recurring income and cut costs.  
Over the next 12 to 18 months the company will restructure into three divisions — funds management, capital investment and operating platforms, which includes infrastructure, real estate and connectivity — according to a statement Wednesday. 
Keppel said it expects annual savings of as much as S$70 million ($53 million) by 2026 from the reorganization.
“This latest restructuring reflects a fundamental shift in how we organize ourselves to operate in a nimbler manner and harness technology to grow at speed and scale,” Chief Executive Officer Loh Chin Hua said in the statement. 
Keppel also announced an interim target of S$100 billion of assets under management by the end of 2026, with a goal to double that by 2030. It had S$50 billion of assets under management at the end of last year. The group will also work toward monetizing assets, including its land bank, to raise as much as S$12 billion by 2026. 
The reorganization comes after Keppel reported full-year net income of S$927 million — beating analyst estimates — but down 9.4% compared to the previous year. Revenue missed estimates by about S$1.5 billion.

-Bloomberg

[weijian]

Wow~ Having to put up just between 5-10% of equity in the sticky FUM business, looks about great! This is in context with CLIM having to seed ~20% of their own money in new funds. This probably explains Keppel Corp's pretty aggressive goal to increase FUM from 53bil (1H23) to 200billion by 2030 (~40% CAGR growth per year from now to 2030)

Briefing for Keppel Corporation’s Retail Shareholders Hosted by SIAS

Of course, when you want to have recurring income, you have to own the assets. When you own the assets, you have to worry about how you are going to fund it. Can it all be from the balance sheet? So that was when we formed Keppel Capital in 2016. The idea was that we wanted to run an asset-light business. At the end of the first half of this year, we have funds under management (FUM) of about S$53 billion, of which about S$3.6 billion was from our balance sheet. The balance comes from third-party funds like pension funds and sovereign wealth funds. If you think about it, our balance sheet is about S$31 billion, so we have been able to grow the FUM beyond the size of our balance sheet. Of course, the target is not to stop there but to go to S$100 billion for FUM by 2026, and then eventually S$200 billion by 2030.

https://links.sgx.com/FileOpen/TRSCR_Bri...eID=769813

[weijian]

Putting up just 10% of equity to seed the fund. Great business economics!

Keppel achieves S$300 million closing for Sustainable Urban Renewal Programme

– Keppel is pleased to announce the closing of a China-focused programme (the Programme) as part of its Sustainable Urban Renewal (SUR) strategy, having secured a global institutional investor for initial equity commitments of RMB 1.6 billion (about S$300 million) of which Keppel’s sponsor stake is RMB 160 million (about S$30 million).

https://links.sgx.com/FileOpen/MREL_Kepp...hieves%20S$300%20million%20closing%20for%20Sustainable%20Urban%20Renewal%20Programme.ashx?App=Announcement&FileID=775267

[weijian]

A 100% stake would be 1034mil and based on 24bil FUM, Keppel Corp is paying 1034mil/24bil = 4.3% of FUM. So at least, Keppel hasn't bought expensive.

From Q&A, the funds will exist for 9~11years, so they are not perpetual. But if the track record is good, future funds will be bigger than previous (as from ppt slide 6). The devil will probably be in the execution like getting the team/principals integrated to Keppel as the parent. So it is clever of Keppel to go in with a 50% stake first and a mixture of equity/cash.

Keppel accelerates transformation with pivotal proposed acquisition of leading European asset manager Aermont Capital

The consideration of up to S$517 million2 for the initial 50% stake in Aermont, which can be funded through a combination of cash and treasury shares acquired through Keppel’s earlier share buyback programme, implies an attractive valuation of c.13x EV/EBITDA

Expands Keppel’s funds under management (FUM) by S$24 billion1 post-acquisition, with further upside potential from co-creating new fund products; Initial focus will be to maintain and support Aermont’s platform, and collectively harness growth opportunities through joint funds.

Media Release: https://links.sgx.com/FileOpen/MREL_Kepp...eID=779494

PPT: https://links.sgx.com/FileOpen/Presentat...eID=779495

Q&A: https://links.sgx.com/FileOpen/TRSCR_Kep...eID=779567