Singapore: Keppel Acquires Stake in Topside Module Fabricator Dyna-Mac Holdings

Strengthening its lead as the total solutions provider for floating production systems, Keppel Offshore & Marine Limited (Keppel O&M), through its wholly-owned subsidiary KS Investments Pte Ltd (KSI), has acquired a 27.77% stake (250,000,000 shares) in topside module fabricator Dyna-Mac Holdings Ltd (Dyna-Mac) via an equity placement.

This follows Dyna-Mac’s successful listing on the main board of Singapore Exchange Securities Trading Limited (SGX) today. KSI’s total investment is S$87.5 million based on the invitation price of 35 cents per share.

The equity placement, through its investment vehicle KSI, is part of a collaboration between Keppel Shipyard (a wholly-owned subsidiary of Keppel O&M) and Dyna-Mac to jointly pursue the topside module business beyond Singapore’s shores.

Mr Nelson Yeo, Managing Director (Marine) of Keppel O&M, was appointed to the Board of Dyna-Mac as a Non-Executive Director.

Mr Yeo said, “This strategic investment strengthens Keppel O&M’s capabilities as a core solutions provider in floating production systems including Floating Production Storage and Offloading vessels (FPSOs).

“Dyna-Mac’s expertise and operations will complement Keppel’s competencies and allow us to exert better control over the process of designing and fabricating oil and gas production modules.”

Having converted and built more than 100 FPSOs, Floating Storage and Offloading vessels (FSOs) and other production units, the Keppel O&M Group has established a solid track record in the engineering, fabrication and integration of topsides for customers worldwide.

“Keppel’s global network, which covers many important markets, presents opportunities for both our companies to collaborate in the oil and gas production facilities business and create value for our customers,” Mr Yeo added.

Mr. Desmond Lim, Executive Chairman and CEO of Dyna-Mac said, “We are very pleased that Keppel O&M sees Dyna-Mac as a strategic partner in its growth plans. Having a strong shareholder such as Keppel on board will broaden the horizon for Dyna-Mac to expand our businesses and offerings globally, as we tap into Keppel’s presence, operating experience and relationships in key overseas markets.

“In harnessing the synergies of Keppel and Dyna-Mac, we are confident of becoming a prime module fabricator in the oil and gas industry, and creating lasting value for our shareholders.

The above acquisition is not expected to have material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Keppel Shipyard is a wholly owned subsidiary of Keppel Corporation, through Keppel Offshore & Marine, a leader in offshore rig repair, design and construction, ship repair and conversion, and specialised shipbuilding. Keppel O&M’s near market, near customer strategy is bolstered by a global network of 20 yards in the Asia Pacific, Gulf of Mexico, Brazil, the Caspian Sea, Middle East and the North Sea regions. Integrating the experience and expertise of its yards worldwide, the Keppel O&M group aims to be the provider of choice and partner for solutions for the offshore and marine industry.

Headquartered in Singapore, Dyna-Mac provides engineering, procurement and construction services to the offshore oil & gas, marine construction and related industries. Its core business activities are in providing detailed engineering, as well as procurement and construction services for topside modules of FPSOs and FSOs. The company also offers detailed engineering and fabrication services for specialised structures, as well as piping for semisubmersible rigs, refineries, and petrochemical and pharmaceutical plants.

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Source:Keppelcorp, March  2, 2011; Image:Dyna Mac