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

People & Company News

Lake Charles Tugboat Engine Room Fire Extinguished

The Coast Guard informs that along with the Black Bayou Fire Department it has responded to a tugboat on fire near Lake Charles, Louisiana. At approximately 1:15 p.

Liberian Registry Appoints Catsiba Manager in Dubai

Fay Catsiba has joined the Liberian International Ship & Corporate Registry (LISCR) as Business Development Manager based in Dubai, U.A.E. Greece-born Fay, who

Cook Joins Horizon Shipbuilding as Operations VP

Horizon Shipbuilding, Inc. announced that Mickey Cook has joined the corporation as the Vice President of Operations for the Bayou La Batre shipyard. Cook, one of the founders of C & G Boatworks,

Cruise Ship Trends

Holland America Line's New Ship is ms Koningsdam

Holland America Line revealed the name of its new 99,500-ton cruise ship slated for delivery in February 2016 will be ms Koningsdam. While the name pays homage

L-3 MSI to Equip Third Quantum Class Ship

L-3 Marine Systems International (L-3 MSI) announced today that it has been awarded a contract to provide a range of navigation, lighting and communication systems

Carnival UK Announces Executive Appointments

David Dingle appointed chairman of Carnival UK; David Noyes promoted to chief executive officer Carnival Corporation & plc announced that David Dingle has been

Ports

Gladding-Hearn Delivers Third NYPD Boat

With more than a dozen patrol boats and a fireboat built by Gladding-Hearn Shipbuilding, Duclos Corporation, operating in New York Harbor, the Somerset, Mass.,

China, Sri Lanka to Launch FTA Talks

Chinese President Xi Jinping began a visit to Sri Lanka on Tuesday agreeing to open bilateral negotiations for a free trade pact as Beijing tightened its embrace

Trelleborg Report Optimistic for Port Investment

The latest 'Barometer Report' from Trelleborg's marine operations business sector, discusses the issues impacting ports and terminals around the globe, and reveals

News

Gladding-Hearn Delivers Third NYPD Boat

With more than a dozen patrol boats and a fireboat built by Gladding-Hearn Shipbuilding, Duclos Corporation, operating in New York Harbor, the Somerset, Mass.,

Cook Joins Horizon Shipbuilding as Operations VP

Horizon Shipbuilding, Inc. announced that Mickey Cook has joined the corporation as the Vice President of Operations for the Bayou La Batre shipyard. Cook, one of the founders of C & G Boatworks,

Update: SS Central America Salvage

Odyssey Marine Exploration completes current phase of SS Central America recovery; 15,500+ gold and silver coins, 45 gold bars recovered to date; 161,000-square meter,

Logistics

China, Sri Lanka to Launch FTA Talks

Chinese President Xi Jinping began a visit to Sri Lanka on Tuesday agreeing to open bilateral negotiations for a free trade pact as Beijing tightened its embrace

Cargo Container Security Alliance Formed

SC-integrity, Inc. (LoJack SCI) and Contguard Ltd. announced a strategic alliance designed to provide their customers with security and real-time visibility of

Mideast Crude Tanker Rates Near 3-month Low

Crude oil tanker earnings on the major Middle East route fell to their lowest in nearly three months as a slowdown in business in recent days battered rate sentiment.

Mergers & Acquisitions

Maersk Sells Ven Drilling Barges

Danish shipping conglomerate A.P. Moller-Maersk said on Tuesday its offshore oil and gas drilling unit has sold its Venezuelan barge activities. Maersk Drilling

Technip Further Optimizes its Subsea Assets

Technip signed today an agreement to sell 100% of its North American diving assets to Ranger Offshore Inc.(1). Technip’s strategy focuses on high technology

Fourth National Security Cutter Delivered to USCG

The Coast Guard accepted delivery of the fourth National Security Cutter, Hamilton, in Pascagoula, Mississippi, Monday. Hamilton will be the first of two NSCs to be homeported in Charleston,

 
 
Maritime Contracts Maritime Security Maritime Standards Pipelines Port Authority Ship Electronics Ship Simulators Shipbuilding / Vessel Construction Sonar Winch
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: 0.1626 sec (6 req/sec)