<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR>Soured deal: No big hit on Keppel shares
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<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->KEPPEL Corp shares largely shrugged off news yesterday that an US$780million (S$1.1billion) deal with a United States firm was souring.
The stock fell 13 cents in early trade before regaining ground to close five cents or 1.2per cent down at $4.05.
Keppel's US unit, AmFels, signed the deal in November 2007 to build four jack-up rigs - each valued at US$195million - for Houston-based Rowan Companies, which serves the drilling industry.
Keppel confirmed reports yesterday that Rowan had made a US regulatory filing asking to suspend construction of one rig and negotiate payment terms on the other three. But Keppel had not been formally approached with the requests.
'We have no idea why Rowan filed with the US Securities and Exchange Commission without any formal discussion having taken place between the two companies,' a Keppel spokesman told The Straits Times yesterday. 'While Keppel AmFels is under no obligation to revise its contractual terms from Rowan, it is reviewing its recent request, if terms are acceptable to Keppel AmFels.'
Reuters yesterday said Rowan's move had been prompted by a fall in oil services and increasingly tight credit conditions.
Yesterday's report added to an already gloomy outlook for Keppel. It announced on Jan9 that two deals, worth $474million, had been terminated.
A contract between Keppel unit KepFels and Seadrill, valued at US$420million, is being continued, albeit under revised terms.
Keppel yesterday said investor concerns were purely due to a bearish outlook in the markets currently.
'Our order book as at end 2008 is $10.8billion, with cashflow positive projects that will stretch into 2012.' ANANYA ROY
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<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->KEPPEL Corp shares largely shrugged off news yesterday that an US$780million (S$1.1billion) deal with a United States firm was souring.
The stock fell 13 cents in early trade before regaining ground to close five cents or 1.2per cent down at $4.05.
Keppel's US unit, AmFels, signed the deal in November 2007 to build four jack-up rigs - each valued at US$195million - for Houston-based Rowan Companies, which serves the drilling industry.
Keppel confirmed reports yesterday that Rowan had made a US regulatory filing asking to suspend construction of one rig and negotiate payment terms on the other three. But Keppel had not been formally approached with the requests.
'We have no idea why Rowan filed with the US Securities and Exchange Commission without any formal discussion having taken place between the two companies,' a Keppel spokesman told The Straits Times yesterday. 'While Keppel AmFels is under no obligation to revise its contractual terms from Rowan, it is reviewing its recent request, if terms are acceptable to Keppel AmFels.'
Reuters yesterday said Rowan's move had been prompted by a fall in oil services and increasingly tight credit conditions.
Yesterday's report added to an already gloomy outlook for Keppel. It announced on Jan9 that two deals, worth $474million, had been terminated.
A contract between Keppel unit KepFels and Seadrill, valued at US$420million, is being continued, albeit under revised terms.
Keppel yesterday said investor concerns were purely due to a bearish outlook in the markets currently.
'Our order book as at end 2008 is $10.8billion, with cashflow positive projects that will stretch into 2012.' ANANYA ROY
