SATs to Acquire Singapore Cruise Center

MarineLink.com
Thursday, September 26, 2013

SATS announced it has through its subsidiaries, SATS Airport Services and SATS-Creuers Cruise Services (SATS-Creuers), entered into a share purchase agreement to acquire the entire issued share capital of Singapore Cruise Center for S$110 million from Temasek.

Singapore Cruise Center is a Singapore-based terminal operator which manages and operates the award-winning international cruise terminal and regional ferry terminal at HarbourFront Center, along with the two ferry terminals at Tanah Merah and Pasir Panjang. It has a strong cash-generative and profitable business, reporting revenue of S$45 million and profit before tax of S$16.7 million for the financial year ended March 31, 2013.

SATS-Creuers is a 60:40 joint venture formed by SATS Airport Services, a wholly-owned subsidiary of SATS, and Creuers del Port de Barcelona (Creuers), to manage and operate the Marina Bay Cruise Center Singapore.

Mr. Tan Chuan Lye, SATS President and Chief Executive Officer said: “This transaction represents a unique opportunity, both for SATS and for Singapore. Singapore Cruise Center has a compelling fit with our existing cruise handling and terminal operations. Together with our strong partnership with Creuers, this transaction will enable us to grow our gateway services business, which in turn will benefit the cruise industry here as a whole.

“The future is bright for the cruise industry in Asia Pacific. The combined entity can leverage our regional airport presence to facilitate and provide a seamless travel experience for Fly-Cruise passengers. This will bolster Singapore’s position as an attractive regional cruise hub and homeport for cruise lines which in turn will benefit the economy.”

Rationale for the Transaction
SATS will connect its operations at Changi Airport with the Singapore Cruise Center in order to enhance the service experience of cruise lines and their passengers. By extending its Cruise-Fly and Fly-Cruise products to Singapore Cruise Center, more passengers will be able to enjoy convenient, seamless transfers to and from Changi Airport. There will also be opportunities for SATS to provide gateway and ship supplies provisioning services to support more cruise lines, hence creating strong homeport opportunities for Singapore.

This deal will grow SATS’ position as a premier gateway services provider more widely, both in Singapore and Asia Pacific. The ferry terminal management business of Singapore Cruise Center will also be a compelling fit with SATS’ gateway capabilities.

As Singapore Cruise Center complements SATS-Creuers’ current cruise terminal operations, the combined entity will have the potential to improve efficiencies, optimize the efficient utilization of berths and resources, and attract more cruise lines to choose Singapore as a regional homeport. The combined entity will also work with industry stakeholders to jointly promote Singapore as a regional cruise hub.

Key Transaction Terms
On completion of the transaction, which is subject to regulatory and shareholders’ approval, SATS Airport Services will directly own approximately 92% of Singapore Cruise Center while SATS-Creuers will own approximately 8%, contributing S$101.25 million and S$8.75 million respectively to the purchase consideration. SATS will effectively own 96.8% of Singapore Cruise Center, contributing S$106.5 million to the purchase consideration.

SATS-Creuers has been granted a call option, exercisable on 31 March 2014, to purchase another 42.3% of Singapore Cruise Center from SATS Airport Services. If the call option is exercised, SATS-Creuers by way of contributing an additional amount of approximately S$46.5 million, will increase its shareholding in Singapore Cruise Center to 50.25%, with SATS Airport Services owning the remaining 49.75%. SATS will then effectively own 79.9% of Singapore Cruise Center, reducing its contribution to the purchase consideration to approximately S$87.9 million.

Purchase Consideration
The purchase consideration of S$110 million was negotiated with Temasek at arm’s length on a willing-buyer, willing-seller basis. It was arrived at based on a number of factors including current market conditions and the business prospects of Singapore Cruise Center. SATS’ portion of the aggregate purchase consideration is intended to be satisfied by internal sources of funds.

The Management of SATS, in consultation with its advisors, considers the purchase consideration to be fair, based on the financial and operational performance of Singapore Cruise Center and the positive growth prospects of the business, when combined with the cruise handling and terminal operations of SATS.

Financial Effects
On a pro forma basis and assuming that the call option is not exercised by SATS-Creuers, the consolidated net tangible assets per share of SATS for FY2012-13 would reduce from S$1.01 to S$0.93. However, the earnings per share of SATS would increase from 16.6 cents to 17.5 cents.

If the call option is exercised by SATS-Creuers, the consolidated net tangible assets per share for FY2012-13 on a pro forma basis would reduce from S$1.01 to S$0.94 while the earnings per share would increase from 16.6 cents to 17.2 cents.

Other than the wider benefits to the cruise business, SATS expects moderate direct operating cost savings and revenue synergies from this transaction.

Regulatory and Shareholders’ Approval
The proposed transaction is subject to, among other things, all necessary regulatory approvals from the Maritime and Port Authority of Singapore and the Competition Commission of Singapore.

Upon receipt of the foregoing approvals, a circular setting out relevant information pertaining to the transaction is expected to be issued to the shareholders of SATS, together with the Notice of Extraordinary General Meeting. Completion of the transaction is subject to SATS shareholders’ approval. Under the listing rules of the SGX-ST, Temasek and its associates will abstain from voting on the resolution to approve the transaction at the Extraordinary General Meeting.

Until the transaction is completed, both SATS-Creuers and Singapore Cruise Center will continue to operate independently.

The Hongkong and Shanghai Banking Corporation Limited, Singapore Branch is the financial advisor to SATS on the proposed transaction of Singapore Cruise Center.
 

Maritime Reporter July 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Euronav Books Profit from Sale of Chartered Ship

The owner of the 157,258 dwt containership Cap Isabella (built 2013), a vessel which Euronav had on bareboat charter, decided to sell the vessel to an unrelated third party.

Livanos Becomes Euronav Chairman

On 22 July 2014, the Board of Directors of Euronav NV unanimously appointed Peter G. Livanos as Chairman of the Board, with immediate effect in replacement of Marc

MN 100: Scania USA Inc.

121 Interpark Blvd. Ste. 1002 San Antonio, Texas 78216 Tel: (210) 679-3126  Email: smurdock@scaniausainc.com Website: www.scaniausa.com President & CEO:

Cruise Ship Trends

Piraeus Port Posts Flat Profit, Sales Dip

Greece's Piraeus Port (OLP) , the largest in the country, said its first-half net profit was almost unchanged from the same year-ago period, while sales fell. Piraeus Port,

Smart-Ship 'Quantum of the Seas' Readies

Tech-savvy modern travelers will be wowed by Royal Caribbean International's newest ship, 'Quantum of the Seas', which incorporates unprecedented levels of technology

Queensland Turns Down Cruise Terminal Request

Australia's Queensland government has backed away from controversial plans to allow a cruise ship terminal to be built on state-owned land on the Gold Coast, according to the 'Brisbane Times'.

Ports

Storm Surge Halts Vessel Operations at Long Beach

Two cargo terminals at the Port of Long Beach announced Wednesday, Aug. 27, that they were suspending vessel operations for the day because 10- to 15-foot high

Port of New Orleans Sponsors Agricultural Summit

The Port of New Orleans has signed on as a sponsor for the 9th annual Oilseed & Grain Trade Summit, taking place here October 7-9, 2014, at the Hyatt Regency New Orleans.

Panama Canal Opens 2nd Maintenance Congress

The Panama Canal Authority (ACP) opens today the Second International Maintenance Congress with the participation of 26 international and six local experts to promote

News

Reflex Marine to Bring FROG-6 into Mexico

Reflex Marine has been granted approval by the Mexican Merchant Marines to sell its crane transfer device, the FROG-6, in Mexico. The certification is a result

Euronav Books Profit from Sale of Chartered Ship

The owner of the 157,258 dwt containership Cap Isabella (built 2013), a vessel which Euronav had on bareboat charter, decided to sell the vessel to an unrelated third party.

Seaborne Ethane and Demand for a New Ship Type

Lloyd's Register report looks at the commercial landscape, regulatory issues and technical realities of a new trade in ethane emerging as a result of increased U.

Logistics

Storm Surge Halts Vessel Operations at Long Beach

Two cargo terminals at the Port of Long Beach announced Wednesday, Aug. 27, that they were suspending vessel operations for the day because 10- to 15-foot high

Port of New Orleans Sponsors Agricultural Summit

The Port of New Orleans has signed on as a sponsor for the 9th annual Oilseed & Grain Trade Summit, taking place here October 7-9, 2014, at the Hyatt Regency New Orleans.

Port of Long Beach Raises Small Business Commitment

The Long Beach Board of Harbor Commissioners – seeking to expand opportunities for a wider range of vendors, contractors and consultants – has set a higher goal

Mergers & Acquisitions

CEVA Expanding Presence in Southern California

CEVA Logistics, one of the world’s leading supply chain management companies, today announced plans to expand its presence in the San Diego market with a new

Transnet National Ports Authority Orders 9 Voith Water Tractors

In South Africa’s largest local shipbuilding contract Transnet National Ports Authority has ordered nine new Voith Water Tractors (VWT) for use in several ports across the country.

Rolls-Royce Acquires Power Systems Unit

Rolls-Royce today announced the completion of its acquisition of Rolls-Royce Power Systems (RRPS).  The move follows an announcement made on March 7, 2014 that

 
 
Maritime Careers / Shipboard Positions Maritime Security Maritime Standards Pipelines Port Authority Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1401 sec (7 req/sec)