SINGAPORE - Flight services firm Sats is buying the Singapore Cruise Centre from Temasek Holdings in a $110 million move to enhance its presence in passenger shipping.
The Singapore Cruise Centre operates the international cruise terminal and regional ferry terminal at HarbourFront Centre, as well as ferry terminals in Tanah Merah and Pasir Panjang. It reported a revenue of $45 million and a profit before tax of $16.7 million for the financial year ended March 31. Sats already runs the Marina Bay Cruise Centre, which began operating in May last year.
"Singapore Cruise Centre has a compelling fit with our existing cruise handling and terminal operations," noted Sats president and chief executive Tan Chuan Lye in a statement.
Sats said it will be able to lift efficiency, better utilise berths and resources, and attract more cruise lines to make Singapore their regional base when it combines the Singapore Cruise Centre with its own terminal operations.
"(The firm) will also work with industry stakeholders to jointly promote Singapore as a regional cruise hub," the statement said. Sats, which provides airport gateway services and in-flight catering, added that it will "connect its operations at Changi Airport with the Singapore Cruise Centre" to improve transfer connections for customers. The firm said there are "encouraging trends" in both cruise ship arrivals and the number of passengers passing through Singapore and the region.
"As the world's major cruise lines increase their presence in Asia, regional cruise terminals are expanding to capture the growing demand for cruise travel," it added. "With this transaction, the combined entity will be well-positioned to compete with the regional cruise terminals to benefit from this growth." Two Sats subsidiaries - Sats Airport Services and Sats-Creuers Cruise Services - are buying the $110 million cruise centre from Hazeltree Holdings, an indirect wholly owned subsidiary of state-owned investment company Temasek.
Sats will own the majority of the facility but some equity will belong to Creuers del Port de Barcelona (Creuers), a European cruise terminal operator. Sats-Creuers is a joint venture between Sats and Creuers. The announcement was made after markets closed.
Sats shares closed two cents lower at $3.13 on Thursday.
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