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SEMBCORP INDUSTRIES AND MARINE DEMERGER: WHAT YOU NEED TO KNOW AND WHAT TO DO (Guest Post)

SEMBCORP INDUSTRIES AND MARINE DEMERGER: WHAT YOU NEED TO KNOW AND WHAT TO DO (Guest Post)

The Sembcorp Group of companies finally announced that Sembcorp Industries and Sembcorp Marine will be demerged with the creation of two focused companies. There will be a proposed Sembcorp Marine Rights issue (SCM Issue) in conjunction with the demerger.

Sembcorp Industries and marine demerger: What you need to know and what to do
This post was originally posted here. The writer, Royston Tan is a veteran community member and blogger on InvestingNote, with username known as Royston_Tan.
I have written on both Sembcorp Marine and Sembcorp Industries several times, stating that it will be in the best interest for Sembcorp Industries, the parent of Sembcorp Marine, the former holding a 61% stake in the latter, to divest its stake in Sembcorp Marine to become a pure utilities/energy player that will find favor among investors who do not wish to have exposure to its marine business.

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Is Time Running Out For Keppel And Sembcorp Marine As Oil Collapses Below Zero? [Guest Post]

Is Time Running Out For Keppel And Sembcorp Marine As Oil Collapses Below Zero? [Guest Post]

This week saw an unprecedented drop in oil prices to a negative level, almost -$40/barrel to be exact. Such a phenomenon has not happened in the past and it was largely the result of paper traders and Oil ETFs dumping their expiring May contracts “by all means” as buyers disappear.

This post was originally posted here. The writer, Royston Tan is a veteran community member and blogger on InvestingNote, with username known as Royston_Tan.

Since then, WTI oil prices have recovered to roughly $17/barrel as of this writing, a positive figure but not a “champagne popping” price level.

IS TIME RUNNING OUT FOR KEPPEL CORP AND SEMBCORP MARINE?

Keppel Corp posts 40% drop in 1Q earnings to $203 mil on lower one ...

The significant collapse of oil prices does not bode well for both Keppel and Sembcorp Marine. Yes, they do not derive their revenue directly from the sale of oil but indirectly in the form of newbuild contracts for production/drilling-related assets.

The problem is that with oil prices that low amid an oil glut scenario, no oil company in their right frame of mind will be contracting large newbuild orders from yards in the near term, in my view.

Can the existing backlog of Keppel and Sembcorp Marine support revenue recognition?

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