Keppel Corporation - Pay day from Keppel T&T?
- Keppel T&T announced last Friday that SPH, Axiata Group and itself are currently undertaking a strategic review in respect of their shareholdings in M1 Ltd which may or may not lead to a transaction.
- Keppel Corp has a 79.37% stake in Keppel T&T, which holds 19.23% of M1.
- In our sum-of-parts valuation, Keppel T&T accounts for about 5% of Keppel Corp’s value, and we do not expect a significant impact on Keppel Corp’s fair value estimate of S$7.40 should an M1 sale materialise.
- The impact would be more greatly felt at the Keppel T&T level, and the market may eye any potential special dividend, given that
- Keppel T&T’s stake in M1 is worth ~S$390m at current prices, and
- Keppel T&T also announced on the same day that it will sell its entire 10% interest in Asia Airfreight Terminal Company for HK$250m (~S$45m).
- Maintain BUY with S$7.40 fair value estimate on Keppel Corp.