The rumours of a merger of the two shipyard units are not new, having first been mooted by Keppel over a year ago. In February chairman of both yards, Choo Chiau Beng said the merger of Keppel FELs and Keppel Hitachi was still in progress. No date was set for the merger. An analyst's report last month said Keppel hoped to reached an agreement with its Japanese shareholders in Keppel Hitachi, in which the Singapore company has a 61% stake, over restructuring.
There was also renewed speculation of a merger between Keppel Hitachi and rival SembCorp Marine to create a single 'superyard’. Prospects of the merger cooled earlier this year when Keppel said it was concentrating on merging its shipyard units Keppel Hitachi and Keppel FELs before pushing ahead with a merger with its rival SembCorp Marine. At the time Keppel's Mr Choo said that some customers in Singapore 'like to have a choice', reflecting market concern that 'one yard meant one price'. Local brokerage, Kim Eng Securities said it made business sense for the two companies to merge as it would reduce competition, and it might be able to get a better price for jobs.
Lloyds List, 10th May 2001
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