Temasek abandons $4 billion bid for Keppel after conglomerate's loss

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SINGAPORE – Singapore’s Temasek Holdings is terminating its $4 billion conditional offer for conglomerate Keppel Corp by invoking a material adverse change (MAC) clause following the company’s poor financial results.

Keppel’s large second-quarter loss that breached a threshold in the state investor’s offer to buy control of the company had raised the risk Temasek would abandon the deal.

“The offeror has decided that it will invoke the MAC pre-condition, and accordingly, is announcing today that the partial offer will not proceed,” a Temasek subsidiary said in a Singapore bourse statement on Monday, a public holiday.

Its decision is still likely to surprise markets as expectations had mounted Temasek would lead much-needed consolidation in the rig-building sector after taking majority control of Keppel.

The domestic rig-building sector has been battered by a long period of low oil prices exacerbated by the coronavirus crisis.

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