Keppel Entities Divest 80 Stake 800 Super 600 Million Valuation
Keppel Reit’s DPU up 24.7% to 1.2 cents for 1H21
Keppel Asia Infrastructure Fund LP (KAIF) and Keppel, through its infrastructure division, have announced the sale of their 80% stake in 800 Super Holdings. The buyer, Actis, is a top investor in sustainable infrastructure with a track record of raising US$26 billion since its inception.
The deal values the waste management company at over $600 million. KAIF and Keppel currently hold 48% and 32% interests respectively in 800 Super and will receive their share of the consideration in cash. The remaining 20% stake in the company is held by William Lee, 800 Super’s co-founder and CEO, who will sell 10% to Actis and retain a 10% stake after the transaction.
The purchase price of $600 million is a significant increase from the $380 million paid by the Keppel entities for their 80% stake in 2019. This marks KAIF’s first divestment, while Keppel has been actively monetizing its assets and plans to divest between $10 and 12 billion by the end of 2022. Prior to this deal, Keppel had already divested $7.8 billion worth of assets since October 2020, when the strategy was announced.
800 Super is one of three licensed public waste collectors in Singapore, providing municipal waste collection services. It was previously listed on the SGX and was privatized in 2019.
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Jopy Chiang, deputy chief investment officer and chief investment officer of Keppel Infrastructure, said, “The divestment of 800 Super demonstrates Keppel’s ability as a global asset manager and operator to identify unique opportunities and enhance and crystallize value from our investments at the right time.” He added that over the past three years, Keppel has worked closely with 800 Super’s management team to optimize operations, expand capabilities, and strengthen the company’s contract portfolio. As a result, 800 Super achieved 20% EBITDA growth since Keppel’s acquisition and is expected to generate an Internal Rate of Return in the mid-teens. Limited partners of KAIF’s fund can also expect capital gains equivalent to half of their initial investment upon divestment.
The deal is expected to be completed by the end of the year and will not have a significant impact on Keppel’s net tangible asset per share or earnings per share for the current financial year. This successful divestment is a testament to Keppel’s expertise in identifying and creating value in its investments, and it is a positive step towards achieving its divestment target.