Keppel Logistics (Foshan) or KLF, which was entirely divested by Keppel Corporation on Sept 27, 2019, has entered into an agreement with the local government, where the latter will pay KLF up to RMB438 million ($89.5 million) for the closure of Lanshi port on March 1.
After KLF has received the compensation, Sinoway Shipping, which acquired KLF from Keppel Corp, will work towards liquidating KLF.
Following the liquidation, Keppel Telecommunications & Transporation (Keppel T&T) will be entitled to 70% of the proceeds of the liquidated assets of KLF.
The assets will include proceeds attributable to Lanshi port, but not proceeds from Sanshui port.
Based on the compensation amount, Keppel Corp is expected to gain some RMB183.5 million, on top of the combined consideration of $39 million for the sale of Keppel T&T’s stakes in KLF and Keppel Logistics (Hong Kong).
Shares in Keppel Corp closed 4 cents lower or 0.8% down at $5.08 on Feb 26.
