Agreement includes Keppel’s divestment of 30% stake in property developer Tianjin Fulong

[SINGAPORE] Keppel Ltd said its wholly owned subsidiaries have entered into an agreement with Tianjin Shunhua Real Estate Construction Management to jointly develop 19 plots of land in the Tianjin Eco-City northern district in China.

The asset manager and operator said on Wednesday (Apr 23) that as part of the equity transfer and cooperation framework agreement, Tianjin Shunhua agreed to pay Keppel Hong Da (KHD) about 503.3 million yuan (S$92.8 million) for a 30 per cent stake in Tianjin Fulong Property Development.

Fulong is a KHD unit that is the developer of the Northern District Project. It will extend a loan to Tianjin Shunhua of around 402.7 million yuan in connection with the divestment. Interest on this will be charged at the prevailing five-year loan prime rate, subject to yearly review.

Following the divestment, KHD’s stake in Fulong will be cut to 21 per cent from 51 per cent. Changzhou Fushi Real Estate Development, a wholly owned subsidiary of Keppel, will continue to own 49 per cent in Fulong.

“The partial divestment of Fulong is part of Keppel’s asset monetisation programme and strategy to collaborate with an experienced real estate partner for the development of large scale projects such as the Northern District Project,” Keppel said in an exchange filing.

It added that had the divestment been completed on Dec 31, 2024, the net tangible asset per share would have risen to S$5.20 from S$5.12.

Keppel’s shares closed S$0.15 or 2.4 per cent higher at S$6.40 on Wednesday, before the announcement.

Copyright SPH Media. All rights reserved.