TEMASEK’s decision to participate in Sembcorp Marine’s (Sembmarine) two rights issues in 2020 and 2021 was made after doing its due diligence into the investment, said Minister in the Prime Minister’s Office Indranee Rajah in Parliament on Monday (Jul 3).

This due diligence took into account Sembmarine’s public disclosures that had already been made prior to the rights issues, said Indranee. “Based on the available facts and disclosures at that time, Temasek made an independent commercial decision to inject capital into company.”

The minister was responding to a question from Workers’ Party Member of Parliament (MP) Louis Chua who asked if Temasek, which became a direct shareholder of Sembmarine in 2020 following the demerger of the company from its then-parent Sembcorp, had taken into account Seatrium’s alleged corruption offences in Brazil. Seatrium is a firm formed by Sembmarine’s merger with Keppel O&M.

In Sembmarine’s disclosure in relation to the Brazilian corruption case, it had mentioned that there were charges by the Brazilian authorities against an ex-employee of the company in his personal capacity, and not against Sembmarine or the company’s Brazilian unit.

Sembmarine also stated that it was not aware of any other of its employees being investigated for these charges.

“All disclosures in the circulars and offered information statements came with a representation by Sembmarine’s board on the accuracy of the information and that all material disclosures had been made,” said Indranee.

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Sembmarine had also stated in multiple announcements at the time that it was committed to the highest standards of compliance with anti-corruption laws and does not condone and will not tolerate any improper business conduct.

“Temasek’s investments in Sembmarine pursuant to the rights issues, as well as those of all other investors, were made based on information provided in the shareholders circulars and offer information statements,” she added.

Indranee further noted that the rights issues were conducted during the pandemic “to ensure that Sembmarine had sufficient funding to see through its business obligations and complete existing projects, given the downturn of the industry, which was exacerbated by Covid-19”.

“Without the recapitalisation, there would potentially have been an erosion of value and the loss of jobs,” she added.