Keppel Ltd. partners with Apollo on USD 2.9bn rig monetization plan

Keppel Ltd. has entered an agreement with Apollo Global Management to move six operational offshore drilling rigs into a newly created private fund. This monetization plan is expected to add approximately USD 2.9 billion to Keppel’s funds under management as part of a strategic shift toward an asset-light, fee-based business model.

Under the deal, Keppel’s Rigco Holding will transfer the rigs to the Keppel Offshore Fund for roughly USD 957 million. Apollo-managed funds will provide the cash portion of the acquisition, while Keppel will contribute its share in kind and remain an investor. Keppel expects to receive approximately USD 478 million in cash during the first phase and will continue to manage the fund, earning recurring management and advisory fees.

The program may eventually include up to 10 legacy rigs, as Keppel plans to potentially transfer four additional rigs currently under construction to the fund between 2027 and 2028. This move is intended to reduce balance-sheet exposure and free up capital for debt reduction or new investments.