Keppel : EGM Circular

CIRCULAR DATED 4 APRIL 2024

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. PLEASE READ IT CAREFULLY.

If you are in any doubt as to the contents herein or as to the course of action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately.

If you have sold or transferred all your shares in the capital of Keppel Ltd. (the "Company" or "Keppel"), you should immediately inform the purchaser, the transferee or the bank, stockbroker or agent through whom the sale or transfer was effected for onward notification to the purchaser or the transferee, that this Circular (together with the Notice of EGM (as defined herein) and accompanying Proxy Form (as defined herein)) may be accessed on the SGXNet at www.sgx.com and the Company's website at https://www.keppel.com/en/investors/agm-egm/. The Singapore Exchange Securities Trading Limited (the "SGX-ST") assumes no responsibility for the accuracy of any statements or opinions made or reports contained in this Circular.

This Circular (together with the Notice of EGM and accompanying Proxy Form) has been made available on the SGXNet and the Company's website at https://www.keppel.com/en/investors/agm-egm/. Printed copies of this Circular will not be despatched to Shareholders (as defined herein). Printed copies of the Notice of EGM and Proxy Form will be despatched to Shareholders.

KEPPEL LTD.

UEN 196800351N

(Incorporated in the Republic of Singapore)

CIRCULAR TO SHAREHOLDERS

IN RELATION TO

1. THE PROPOSED TRANSACTIONS (AS DEFINED HEREIN), INCLUDING:
2. 1. THE PROPOSED AMENDMENT AND EXTENSION OF THE CAPACITY TOLLING AGREEMENT BETWEEN KEPPEL MERLIMAU COGEN PTE LTD, KEPPEL ELECTRIC PTE LTD, AND KEPPEL INFRASTRUCTURE HOLDINGS PTE. LTD.; AND
   2. THE PROPOSED AMENDMENT AND EXTENSION OF THE OPERATIONS AND MAINTENANCE SERVICES AGREEMENT BETWEEN KEPPEL MERLIMAU COGEN PTE LTD, KMC O&M PTE. LTD., AND KEPPEL INFRASTRUCTURE HOLDINGS PTE. LTD.; AND
3. THE PROPOSED SUBSCRIPTION OF NEW UNITS IN KEPPEL INFRASTRUCTURE TRUST BY KEPPEL INFRASTRUCTURE HOLDINGS PTE. LTD. PURSUANT TO THE KIT EQUITY FUND RAISING (AS DEFINED HEREIN).

Independent Financial Adviser

PRIMEPARTNERS CORPORATE FINANCE PTE. LTD.

UEN 200207389D

(Incorporated in the Republic of Singapore)

IMPORTANT DATES AND TIMES
Last date and time for submission of questions in	:	11	April 2024 at 5.00 p.m.
advance of the EGM (as defined herein)
Target date for publication of responses to substantial	:	14	April 2024
and relevant questions received
Last date and time for lodgement of Proxy Form	: 16	April 2024 at 5.00 p.m.
Date and time of EGM	:	19	April 2024 at 5.00 p.m. (or as soon thereafter
		following the conclusion or adjournment of the annual
		general meeting of the Company to be held at
		3.00 p.m. on the same day and at the same venue)
Place of EGM	:	Suntec Singapore Convention and Exhibition Centre,
		Nicoll 1-2, Level 3, 1 Raffles Boulevard, Suntec City,
		Singapore 039593

	TABLE OF CONTENTS
DEFINITIONS	2
CIRCULAR TO SHAREHOLDERS	9
1.	INTRODUCTION	10
2.	INFORMATION ON KIT AND KMC	18
3.	THE PROPOSED CTA AMENDMENTS	19
4.	THE PROPOSED OMSA AMENDMENTS	21
5.	RATIONALE AND BENEFITS	23
6.	CHAPTER 9 OF THE LISTING MANUAL	24
7.	ILLUSTRATIVE FINANCIAL EFFECTS	28
8.	INTERESTS OF DIRECTORS AND CONTROLLING SHAREHOLDERS	31
9.	AUDIT COMMITTEE'S STATEMENT	33
10.	RELEVANT DIRECTORS' RECOMMENDATIONS	33
11.	ABSTENTION FROM VOTING	34
12.	DIRECTORS' RESPONSIBILITY STATEMENT	34
13.	CONSENT BY THE IFA	35
14.	DOCUMENTS AVAILABLE FOR INSPECTION	35
APPENDIX A INFORMATION REGARDING THE TOLLING FEE UNDER THE CTA	A-1
APPENDIX B INFORMATION REGARDING THE SERVICE FEE UNDER THE OMSA	B-1
APPENDIX C IFA LETTER	C-1
NOTICE OF EXTRAORDINARY GENERAL MEETING	D-1

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DEFINITIONS

The following definitions shall apply throughout this Circular unless the context otherwise requires or unless otherwise stated:

"2015 KMC	:	The restructuring of KMC in connection with the KMC
Restructuring"		Acquisition, as described in paragraph 1.1 of this
		Circular
"Audit Committee"	:	The audit committee of the Company
"BTA"	:	Business Trusts Act 2004
"Capacity Adjustment	:	Has the meaning ascribed to it in paragraph 3.2(b)(i) of
Factor"		this Circular
"Capacity Fee"	:	The availability-based capacity fee to be paid to KMC by
		KE pursuant to the CTA, as described in paragraphs 1.2
		and 3.1 and Appendix A of this Circular.
"CDP"	:	The Central Depository (Pte) Limited
"Circular"	:	This circular to Shareholders dated 4 April 2024
"Companies Act"	:	Companies Act 1967
"Company" or "Keppel"	:	Keppel Ltd. (formerly known as "Keppel Corporation
		Limited"), a company incorporated in the Republic of
		Singapore
"CPI"	:	Singapore consumer price index
"CTA"	:	The capacity tolling agreement entered into between
		KMC (as the Owner of the KMC Plant), KE (as the Toller)
		and KIHPL (as guarantor for the Toller), as amended or
		modified from time to time
"CTA Extension Option"	:	Under the existing CTA, the option given to KE to
		extend the duration of the CTA by a 10-year period from
		the expiry of the CTA at the same terms, as described in
		paragraph 1.2 of this Circular
"CTA Supplemental	:	The proposed supplemental agreement to be entered
Agreement"		into between KMC (as the Owner of the KMC Plant), KE
		(as the Toller) and KIHPL (as guarantor for the Toller) to
		amend the CTA
"Directors"	:	The directors of the Company (and each of them, a
		"Director")
"DPU"	:	Distribution per unit

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"EGM"	:	The extraordinary general meeting of the Company to
		be held on 19 April 2024, notice of which is given in the
		Notice of EGM (or any adjournment thereof)
"Electricity Licence"	:	The electricity licence granted to KMC from the EMA
		under the Electricity Act 2001, as described in paragraph
		2.2 of this Circular
"Electricity Licence Expiry	:	Has the meaning ascribed to it in paragraph 2.2 of this
Date"		Circular
"EMA"	:	Energy Market Authority
"EMC"	:	Energy Market Company Pte Ltd, a company
		incorporated in the Republic of Singapore
"EPS"	:	Earnings per share
"External Facility"	:	Credit facilities obtained by KMC from commercial
		banks by signing a facility agreement for S$700 million
		with financial institutions in Singapore, as described in
		paragraph 1.4 of this Circular
"FY2023"	:	The financial year ended 31 December 2023
"FY2023 Financial	:	The audited consolidated financial statements of the
Statements"		Company for FY2023
"FY2024"	:	The financial year ending 31 December 2024
"Group"	:	The Company and its subsidiaries
"IFA"	:	PrimePartners Corporate Finance Pte. Ltd., being the
		independent financial adviser to the Company
		appointed pursuant to Rule 921(4) of the Listing Manual
		as well as to advise the Audit Committee and the
		Relevant Directors on the Proposed Transactions and
		the Proposed KIT Subscription, as described in
		paragraph 6.9 of this Circular
"IFA Letter"	:	The letter from the IFA to the Audit Committee and the
		Relevant Directors relating to the Proposed Transactions
		and the Proposed KIT Subscription, as set out in
		Appendix C of this Circular
"Illustrative Issue Price"	:	The illustrative issue price of S$0.471 per new KIT Unit
		under the KIT Equity Fund Raising
"IPT"	:	Interested person transaction

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"IPT Aggregate Value"	:	The aggregate amount at risk of the Proposed
		Transactions to Keppel in accordance with Rule 909 of
		the Listing Manual, as set out in paragraph 6.4 of this
		Circular
"KE"	:	Keppel Electric Pte Ltd, a company incorporated in the
		Republic of Singapore, and a wholly-owned subsidiary
		of the Company
"Keppel Energy"	:	Keppel Energy Pte. Ltd., a company incorporated in the
		Republic of Singapore, and a wholly-owned subsidiary
		of the Company, and which has a 49% equity interest in
		KMC
"Keppel Sakra Cogen	:	The proposed 600MW state-of-the-art, advanced
Plant"		combined cycle gas turbine (CCGT) power plant to be
		owned by Keppel Sakra Cogen Pte. Ltd., as described in
		the joint media release between the Company,
		Mitsubishi Power and Jurong Engineering Limited
		released on the SGXNet on 30 August 2022
"KIHPL"	:	Keppel Infrastructure Holdings Pte. Ltd., a company
		incorporated in the Republic of Singapore, and a
		wholly-owned subsidiary of the Company
"KIT"	:	Keppel Infrastructure Trust, a business trust constituted
		in the Republic of Singapore and registered with MAS
"KIT Equity Fund Raising"	:	The proposed equity fund raising by KIT, by way of the
		issuance of up to 1,061,571,125 new KIT Units, which
		may comprise:
		(a) the KIT Placement; or
		(b) the KIT Placement and the KIT Preferential Offering
"KIT Expiry Date"	:	The expiry of any approval received by KIT for the
		issuance of new KIT Units, as defined in footnote 6 of
		this Circular
"KIT Placement"	:	KIT's potential private placement of KIT Units to
		institutional and other investors under the KIT Equity
		Fund Raising, as defined in paragraph 1.6(a) of this
		Circular
"KIT Preferential	:	KIT's potential non-renounceable preferential offering
Offering"		of KIT Units to eligible KIT Unitholders on a pro rata
		basis under the KIT Equity Fund Raising, as defined in
		paragraph 1.6(b) of this Circular
"KIT Trustee-Manager"	:	Keppel Infrastructure Fund Management Pte. Ltd.,
		acting in its capacity as trustee-manager for KIT

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"KIT Unitholders"	:	The unitholders of KIT
"KIT Unit"	:	An undivided interest in KIT, as provided for in the trust
		deed dated 5 January 2007 constituting KIT (as
		amended and modified from time to time)
"KIT Ventura	:	Has the meaning ascribed to it in paragraph 1.6 of this
Announcement"		Circular
"KMC"	:	Keppel Merlimau Cogen Pte Ltd, a company
		incorporated in the Republic of Singapore, in which KIT
		holds a 51% equity interest and Keppel Energy holds a
		49% equity interest
"KMC Acquisition"	:	The acquisition by KIT of a 51% direct interest in KMC
		on 30 June 2015
"KMC Capital	:	For the purposes of this Circular, the KMC Refinancing,
Restructuring"		the Proposed CTA Amendments and the Proposed
		OMSA Amendments, as described in paragraph 5.1 of
		this Circular
"KMC I"	:	Phase I of KMC, which has a generation capacity of
		500MW and commenced operation in April 2007, as
		described in paragraph 2.2 of this Circular
"KMC II"	:	Phase II of KMC, involving the expansion of two power
		trains with a total generation capacity of 840MW, which
		commenced commercial operations in March 2013 and
		July 2013 respectively, as described in paragraph 2.2 of
		this Circular
"KMC Notes"	:	Has the meaning ascribed to it in paragraph 1.1(c) of
		this Circular
"KMC O&M"	:	KMC O&M Pte. Ltd., a company incorporated in the
		Republic of Singapore, and a wholly-owned subsidiary
		of KIHPL
"KMC Plant" or "Power	:	Keppel Merlimau Cogen Plant
Plant"
"KMC Refinancing"	:	The refinancing exercise to be undertaken by KMC,
		whereby the External Facility will be refinanced with
		the New External Facility, as described in paragraph
		5.1(b) of this Circular
"KSC"	:	Keppel Sakra Cogen Pte. Ltd., a company incorporated
		in the Republic of Singapore
"KWS"	:	Keppel Water Services Pte. Ltd., a company incorporated
		in the Republic of Singapore

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"Latest Practicable Date"	:	4 March 2024, being the latest practicable date prior to
		the finalisation of this Circular
"Listing Manual"	:	The listing manual of the SGX-ST, as amended or
		modified from time to time
"MAS"	:	The Monetary Authority of Singapore
"New External Facility"	:	New credit facilities to be obtained by KMC, as
		described in paragraph 5.1(b) of this Circular
"Notice of EGM"	:	The notice of EGM, as set out in pages D-1 to D-4 of this
		Circular
"NTA"	:	Net tangible assets
"O&M Fee"	:	The fixed operation and maintenance fee under the CTA
"OMSA"	:	The operations and maintenance services agreement
		entered into between KMC, KMC O&M, and KIHPL on
		15 May 2015
"OMSA Extension	:	Under the existing OMSA, the option to extend the
Option"		OMSA by a period of 10 years, exercisable on top of the
		initial contract term of 20 years from 1 January 2015, as
		described in paragraph 1.3 of this Circular
"OMSA Supplemental	:	The proposed supplemental agreement to be entered
Agreement"		into between KMC, KMC O&M and KIHPL to amend the
		terms of the OMSA
"Operator"	:	KMC O&M
"Ordinary Resolution"	:	A resolution proposed and passed as such by a majority
		being more than 50% of the total votes cast for and
		against such resolution at a general meeting of the
		Shareholders convened in accordance with the
		constitution of the Company
"Ordinary Resolution 1"	:	The Ordinary Resolution in relation to the Proposed
		Transactions
"Ordinary Resolution 2"	:	The Ordinary Resolution in relation to the Proposed KIT
		Subscription
"Owner"	:	KMC
"PIL"	:	Pacific International Lines (Private) Limited, a company
		incorporated in the Republic of Singapore
"Proposed CTA	:	The proposed amendments to and extension of the CTA
Amendments"		as set out in the CTA Supplemental Agreement

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"Proposed KIT	:	Has the meaning ascribed to it in paragraph 1.7 of this
Subscription"		Circular
"Proposed OMSA	:	The proposed amendments to and extension of the
Amendments"		OMSA as set out in the OMSA Supplemental Agreement
"Proposed Transactions"	:	The Proposed CTA Amendments and the Proposed
		OMSA Amendments
"Relevant Directors"	:	All the Directors, save for Mr. Teo Siong Seng who
		abstained from giving a recommendation to
		Shareholders for the reasons set out in paragraph 10.3
		of this Circular

"S$", "SGD", and "Singapore cents"

"Service Fee"

• Singapore dollars and cents respectively, being the lawful currency of the Republic of Singapore
• The fixed O&M service fee indexed to the CPI to be paid to KMC O&M by KMC, under the OMSA, as described in paragraphs 1.3 and 4.1 and Appendix B of this Circular

"SFA"	:	Securities and Futures Act 2001
"SGX-ST"	:	Singapore Exchange Securities Trading Limited
"SGXNet"	:	Singapore	Exchange	Network	(accessible	at
		www.sgx.com)
"Shareholders"	:	The shareholders of the Company, including persons
		whose/which Shares are deposited with CDP or who
		have purchased Shares on the SGX-ST (and each of
		them, a "Shareholder")
"Shares"	:	The ordinary shares in the issued share capital of the
		Company
"Tax Incentives"	:	The tax incentives attributable to the KMC Notes
		qualifying as qualifying project debt securities under
		the MAS	Circular (FDD	Circular	15/2006) on	Tax

Incentives for Project Finance dated 1 November 2006, as extended and enhanced by the MAS Circular (FDD Circular 02/2008) dated 12 May 2008 and the MAS Circular (FDD Circular 01/2011) dated 28 April 2011 on Tax Incentives for Project and Infrastructure Finance

"Temasek": Temasek Holdings (Private) Limited, a company incorporated in the Republic of Singapore, and a substantial shareholder of the Company

"Toller"

:

KE

7

"Tolling Fee"	:	The Capacity Fee and fixed O&M Fee to be paid to KMC
		by KE pursuant to the CTA, as described in paragraphs
		1.2 and 3.1 and Appendix A of this Circular
"%" or "per cent"	:	Per centum or percentage

A reference to "paragraph" is a reference to a paragraph of this Circular unless otherwise specified or the context otherwise requires.

The terms "Depositor", "Depository agent" and "Depository Register" shall have the meanings ascribed to them respectively in Section 81SF of the SFA.

Words importing the singular shall, where applicable, include the plural and vice versa and words importing any one gender shall, where applicable, include the other genders where applicable. References to persons shall, where applicable, include corporations.

Any reference in this Circular to any enactment is a reference to that statute or enactment for the time being amended or re-enacted. Any term defined under the Companies Act, the SFA or the Listing Manual or any statutory modification thereof and used in this Circular shall, where applicable, have the meaning assigned to it under the Companies Act, the SFA or the Listing Manual or any statutory modification thereof, as the case may be, unless otherwise provided.

Any discrepancies in tables included herein between the amounts in the columns of the tables and the totals thereof are due to rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

Any reference to a time of day in this Circular shall be a reference to Singapore time unless otherwise stated.

All statements other than statements of historical facts included in this Circular are or may be forward-looking statements. Forward-looking statements include but are not limited to those using words such as "seek", "expect", "anticipate", "estimate", "believe", "intend", "project", "plan", "strategy", "forecast" and similar expressions or future or conditional verbs such as "will", "would", "should", "could", "may" and "might". These statements reflect the Company's current expectations, beliefs, hopes, intentions or strategies regarding the future and assumptions in light of currently available information. Such forward-looking statements are not guarantees of future performance or events and involve known and unknown risks and uncertainties. Accordingly, actual results may differ materially from those described in such forward-looking statements. Shareholders and investors of the Company should not place undue reliance on such forward-looking statements, and the Company does not undertake any obligation to update publicly or revise any forward-looking statements.

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