“The proceeds based on the estimated Relevant Consideration represent a deficit of $222 million over the book value of the Proposed Transaction Assets,” Keppel says in its Ch 10 announcement. The loss on disposal translates into a net loss in the P&L, and in turn, will translate into a lower pro forma earnings per share (EPS) for Keppel’s 1FY2025 if the transaction had been completed on Jan 1.
During Keppel’s analyst and media briefing on Aug 11, questions swirled around the net loss that Keppel is likely to book once the sale of M1 to Simba completed. Keppel announced that it has agreed to divest M1 for an enterprise value of $1.43 billion with an implied FY2024 EV/Ebitda of 7.3x excluding the ICT business which has a book value of $300 million. The ICT business comprises – among other things – Keppel’s data centre business which includes its build and operate skills. Keppel is sponsor to Keppel DC REIT.
Keppel will receive $1 billion in cash proceeds for its 83.9% stake in M1. The businesses to be sold are M1 Shop, M1 Net, Antina and M1 Network. Keppel will retain the ICT business which includes M1 Tellient, AsiaPac Technology Holding and M1’s leasehold stake in MiWorld,
