In a disclosure to the Philippine Stock Exchange, Keppel said it has reached agreement with GECF to sell its 23.406 million shares in KBP as part of its strategy to divest its non-core assets.
The Keppel Group is focused on its offshore and marine, property and infrastructure businesses with global foot print in 27 countries. Keppel will leverage its resources to realize new growth opportunities and business excellence.
Keppel said the offer price was based on KBP’s book value, operational infrastructure and fair market value of assets.
KBP has total assets of approximately $90 million. It has 30 branches and provides a broad range of banking and financial services, including deposits, personal loans, mortgages, auto loans and credit cards.
The proposed transaction is subject to the approval of BSP and New York State Banking Department. Upon closing, GECF will assume operational control of the bank
"We are pleased with the opportunity to expand our strategic focus in Southeast Asia by gaining a platform for growth in the Philippines," said Ridha Wirakusumah, president and CEO of GE Money Southeast Asia and head of banking, Asia.
"The consumer banking and financial services industry in the Philippines is well-positioned for long-term growth, and we are looking forward to building on the solid foundations established by Keppel Bank and leveraging our global success and our experience in developing economies to build a strong presence in this significant market," Wirakusumah said.
Keppel director Teo Soon Hoe said: "This is a very positive development for Keppel Bank. We are very pleased that Keppel Bank’s existing customers and the Filipino consumers will now have the benefit of GECF’s global experience, and the opportunity to access a full suite of innovative financial products."
Keppel through its associates will purchase from KBP Keppel Center, a 15-story office-cum-residential building in Cebu, for P260 million based on fair market value.
The sale of KBP and the purchase of Keppel Center is expected to raise the net tangible assets of Keppel Philippines Holdings by about P0.80 per share compared to the value as of June 30, 2005.
With more than $150 billion in assets, GECF is a leading provider of credit services to consumers, retailers, and auto dealers in 47 countries around the world.