Apollo Global to invest $1.5 billion in Keppel oil rig fund

The two companies announced on Monday that Apollo Global Management will invest $1.5 billion into Keppel, a Singaporean company. This fund will own six oil rigs in operation. The deal will allow Keppel to monetise non-core assets, unlock capital and invest in new projects. Apollo can tap into the offshore energy market of the region, which has high utilization rates and long-term demand trends. Keppel plans to sell 10 oil rigs owned by Rigco Holding Pte for S$3.7 billion (2.87 billion) to reduce debt, reward shareholders and free up money for new investments. Keppel is expecting to receive $478 million in cash from the sale of six oil rigs for S$1.2billion. Singapore's fund manager, Keppel Offshore Fund, will contribute 50% to the private fund via an indirect unit. Keppel stated that the divestment of six rigs will add S$3.9 billion in Keppel funds under management. Fund manager 'intends to also 'divest four more rigs currently under construction to the new fund between 2027 and?2028. Keppel is expected to receive $988?million as cash proceeds from the transaction. Keppel is expected to book a loss of S$92m from the sale of six operational rigs when it announces its first-half financial results on July 30.

(source: Reuters)