Keppel Infrastructure Trust to divest 24.6% stake in Australian bus service business for A$130 million

Keppel Infrastructure Fund Management, the manager of Keppel Infrastructure Trust (KIT), is divesting a 24.6 per cent stake in an Australian bus service business, Ventura Motors, for A$130 million (S$109 million).

This is a 19 per cent premium from KIT’s acquisition price for the relevant stake, said the manager in a bourse filing on Tuesday (June 10). It had in June 2024 acquired a 97.7 per cent interest in Ventura for an enterprise value of A$600 million.

With the divestment, KIT will hold a 73.1 per cent share in the company, and its chief executive officer (CEO) Andrew Cornwall, a 2.3 per cent share. The remaining will be acquired by private investment funds managed by Samsung Asset Management.

Kevin Neo, the chief executive of the manager, said the move is part of the trust’s value creation strategy.

The manager’s two recent divestments – including the sale of its 50 per cent stake in a storage facility in the Philippines – are valued at around S$301 million.

“(This) will bolster KIT’s financial strength and agility, and enhance its ability to capture further opportunities through strategic capital recycling,” said Neo.

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He added that the trust will continue working with Ventura’s management to strengthen and grow the business, to generate stable, recurring and predictable cash flows.

Headquartered in Melbourne, the bus-service provider has a fleet of around 900 buses and 12 depots. It has the largest market share of public bus services in the Australian state of Victoria, and transports more than 42 million people annually.

The transaction is expected to be completed by the third quarter of this year, and is subject to conditions precedent as well as approval from regulators and the authorities.

It is not expected to have a material impact on the distribution per unit and net tangible assets per unit of KIT for FY2025.

Units of KIT closed flat at S$0.395 on Tuesday, before the announcement.