Diving Jackup Rigs

Research evidence excerpt

Diving Jackup Rigs

Update

July 28, 2026 12:07 AM GMT

Morgan Stanley Asia (Singapore) Pte.+MKeppel Ltd | Asia Pacific Mayank Maheshwari

Equity Analyst

Divesting Jackup Rigs Mayank.Maheshwari@morganstanley.comRyan M Heng +65 6834-6719

Ryan.Heng@morganstanley.com +65 6834-6465

Keppel, in a surprise announcement, is looking to divest six operational jackup

Vivek Rajamani

offshore rigs to a fund backed equally by Keppel and Apollo Management Singapore. Equity Analyst

The deal values each rig at ~US$230mn (enterprise value/rig, includes an estimated Vivek.Rajamani@morganstanley.com +65 6834-6740

~S$600mn in debt), slightly above our estimates, in line with current market Morgan Stanley India Company Private Limited+

Pranitha Shetty

valuation but a significant surprise to buyside skeptical expectations around Research Associate

divestment of the rigs. The transaction will result in a S$92mn disposal loss. We Pranitha.Shetty@morganstanley.com +91 22 6118-3022

estimate Keppel+Apollo fund to return ~11-12% unlevered IRR though the dayrate Hinal Choudhary

Research Associate

cycle. Hinal.Choudhary@morganstanley.com +91 22 6118-2044

The S$611mn in cash proceeds from sale of six rigs for Keppel will reduce net debt

by ~12% while raise dividends. YTD divestments cover halve of our ~S$0.16/share

DPS upside from asset monetization. The ~S$1bn in cash in RigCo would be used to

complete the remaining four rigs (2 semisubs, 1 jackup and 1 drillship) which could

be monetized at a combined S$1.3bn in 2027/2028. Keppel Ltd (KPLM.SI, KEP SP)

ASEAN Energy and Materials | Singapore

As energy security takes center stage, we see opportunities for Keppel+Apollo fund

Stock Rating Overweight

to deploy these rigs and also redeploy capital in its energy and infrastructure Industry View Attractive