SPH to potentially delist following proposed SG$3.4bn acquisition, Keppel in bid

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Keppel Corporation has proposed to acquire and privatise Singapore Press Holdings (SPH) excluding its media arm. Upon successful completion, SPH will eventually be delisted and become a wholly-owned subsidiary of Keppel. Keppel will also hold a remaining stake in SPH REIT and Keppel REIT of about 20% each. The deal values SPH at SG$3.4 billion and Keppel's share of the deal is SG$2.2 billion. The scheme is subjected to approval by Keppel and SPH shareholders, as well as other conditions including regulatory approvals.

SPH CEO Ng Yat Chung said the outcome is the result of a strategic review process that has taken place over many months. He explained that SPH took the first step with the media restructuring to ensure a sustainable future for its media business while removing losses from SPH. The next step was a thorough process to unlock and maximise value for all shareholders for the remaining company.

In May, SPH said it is transferring its media business to a newly incorporated wholly-owned subsidiary, SPH Media Holdings, amidst the ongoing challenge of falling advertising revenue. SPH Media Holdings will eventually be transferred to a not-for-profit entity for a nominal sum, and the not-for-profit entity will be a newly formed public company limited by guarantee (CLG).

Aside from the restructuring, SPH added previously that the restrictions under the Newspaper and Printing Presses Act, including the 5% shareholder cap restriction and the issue of management shares, would be lifted. The Board carried out a comprehensive review of the various strategic options, including maintaining the status quo, monetisation of certain assets, a partial sale or privatisation of SPH post media restructuring.

In a bid to maximise value and minimise disruption of shareholders, the Board concluded that the privatisation of the entire company would be the preferred solution. SPH added that doing so derives a better valuation outcome for all shareholders where a control premium is paid for the entire company. Also, it avoids a situation where prime SPH assets are cherry-picked, leaving SPH with its existing debt and the risk of being unable to monetise its remaining assets.

Shortly after the media restructuring was announced, former deputy CEO and editor-in-chief, Patrick Daniel, was appointed as interim CEO of SPH Media Trust, while Khaw Boon Wan was named chairman of the new entity.

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