Proposed Acquisition of All the Shares in the Capital of Singapore Cruise Centre Pte Ltd

SATS LTD. (Incorporated in the Republic of Singapore) (Company Registration No. 197201770G)

PROPOSED ACQUISITION OF ALL THE SHARES IN THE CAPITAL OF SINGAPORE CRUISE CENTRE PTE LTD

1. INTRODUCTION

The Board of Directors (the “Board”) of SATS Ltd. (“SATS”) is pleased to announce that its subsidiaries, SATS Airport Services Pte Ltd (“SAS”) and SATS-Creuers Cruise Services Pte. Ltd. (“SCCS”) have today entered into a sale and purchase agreement (the “Sale and Purchase Agreement”) with Hazeltree Holdings Private Limited (the “Vendor”), pursuant to which the Vendor has agreed to sell, and SAS and SCCS (collectively, the “Purchasers”) have jointly agreed to purchase, all of the shares in the capital of Singapore Cruise Centre Pte. Ltd. (“SCCPL” and such shares, the “Sale Shares”).

Completion (“Completion”) of the sale and purchase of the Sale Shares (the “Acquisition”) is subject to the conditions precedent (“Conditions”) set out in Section 2.4 of this Announcement being satisfied or waived.

2. THE ACQUISITION

2.1 Introduction: SCCPL is a Singapore-based cruise and ferry terminal operator. For further details on SCCPL, please refer to Section 4 of this Announcement.

2.2 Sale and Purchase Agreement: Pursuant to the terms of the Sale and Purchase Agreement, the Sale Shares will be purchased by the Purchasers free from all encumbrances, and together with all rights, dividends, entitlements and advantages attached to them as at Completion and thereafter.

On Completion, the Sale Shares shall be acquired by the Purchasers in proportion to their respective contributions to the Aggregate Consideration, to be calculated as set out in Section 2.3 below. The Purchasers will acquire the Sale Shares in the following proportions (in relation to each Purchaser, its “Relevant Proportion”):

2.2.1 SAS: 9,204,545 Sale Shares representing approximately 92 per cent. of the Sale Shares; and

2.2.2 SCCS: 795,455 Sale Shares representing approximately 8 per cent. of the Sale Shares.

2.3 Consideration:

2.3.1 The Sale Shares will be acquired at an aggregate consideration (the “Aggregate Consideration”) of S$110,000,000 to be paid by each Purchaser to the Vendor on Completion in proportion to its Relevant Proportion, as follows:

(i) SAS shall pay S$101,250,000; and

(ii) SCCS shall pay S$8,750,000.

2.3.2 The Purchasers and the Vendor (the “Parties”, and each, a “Party”) have agreed that there will be no adjustment to the Aggregate Consideration whatsoever, save for adjustments made pursuant to good faith discussions between the Parties in the event of (i) the occurrence of an agreed material adverse event or (ii) the imposition of certain directions by the Competition Commission of Singapore (the “CCS”), each of which would otherwise entitle the Purchasers to terminate the Sale and Purchase Agreement.

2.3.3 The Aggregate Consideration was arrived at after arm’s length negotiations on a willing-buyer, willing-seller basis, and is to be satisfied wholly in cash. In arriving at the Aggregate Consideration, the Purchasers have taken into account, inter alia, current market conditions and the business prospects of SCCPL.

2.3.4 In the event that SCCS fails to complete the Acquisition on the terms and conditions set out in the Sale and Purchase Agreement for any reason whatsoever through no fault of the Vendor, SAS shall undertake to make payment of SCCS’ Relevant Proportion of the Aggregate Consideration and the Vendor shall undertake to sell and transfer SCCS’ Relevant Proportion of the Sale Shares to SAS free from all encumbrances and the Vendor and SCCS shall have no further claims against each other.

2.4 Conditions Precedent: Pursuant to the terms of the Sale and Purchase Agreement, the Acquisition is subject to and conditional upon, inter alia, the following Conditions being satisfied or waived:

2.4.1 the approval of the shareholders of SATS for all resolutions as may be necessary or incidental to approve, implement or effect the Acquisition (on and subject to the terms and conditions of the Sale and Purchase Agreement) (“Shareholders’ Approval”) having been obtained;

2.4.2 the receipt of the decision of the CCS that the Acquisition does not and/or will not infringe the prohibition under Section 54 of the Competition Act, Chapter 50B of Singapore, on terms satisfactory to the Parties; and

2.4.3 the receipt by SCCPL of, pursuant to condition 23 of SCCPL’s Public Licence for Port Services and Facilities, the written approval of the Acquisition by the Maritime and Port Authority of Singapore.

2.5 Long-Stop Date: The long-stop date for the satisfaction of the Conditions (the “Long-Stop Date”) is 31 March 2014 or such other date falling on or before 30 September 2014 as the Parties may mutually agree in writing.

3. INFORMATION ON THE PURCHASERS

3.1 Purchasers: SAS is a wholly-owned subsidiary of SATS. In turn, SAS holds 60 per cent. of all the shares in the capital of SCCS, which is a joint venture between SATS and Creuers Del Port De Barcelona S.A. (“Creuers”). Creuers holds the remaining 40 per cent. of all the shares in the capital of SCCS. SCCS manages and operates the Marina Bay Cruise Centre Singapore. No change in the respective percentage shareholdings of SAS and Creuers in SCCS is contemplated to result from the Acquisition.

3.2 Call Option: In connection with the Acquisition, SAS has granted a call option to SCCS, pursuant to which SCCS has the right to acquire such number of Sale Shares from SAS required to increase the shareholding of SCCS to 50.25 per cent. of the total number of Sale Shares, at a price per Sale Share equal to the price per Sale Share represented by the Aggregate Consideration (“Call Option”). The Call Option will be exercisable on 31 March 2014, and will expire if not exercised by 5.00 p.m. (Singapore time) on that date.

4. INFORMATION ON SCCPL

4.1 SCCPL: SCCPL is a private limited company incorporated in Singapore in 2003. It is a Singapore-based terminal operator which manages and operates the award-winning international cruise terminal and regional ferry terminal at HarbourFront Centre, in addition to two ferry terminals at Tanah Merah and Pasir Panjang. It has a profitable business, reporting revenue of S$45 million for the financial year ended 31 March 2013.

4.2 Asset Value: As at 31 March 2013 and 30 June 2013 respectively, the book value of the Sale Shares was approximately S$62,789,000 and S$66,422,000 and the net tangible asset value of the Sale Shares was approximately S$21,627,000 and S$26,644,000.

4.3 Net Profits: For the financial year ended 31 March 2013 (“FY2012-13”) and the financial period ended 30 June 2013 respectively, the net profit of SCCPL was approximately S$16,716,000 and S$4,482,000.

5. RATIONALE FOR THE ACQUISITION

5.1 The Acquisition will grow SATS’ position as a premier gateway services provider more widely, both in Singapore and Asia Pacific. SCCPL’s ferry terminal management business will also be a compelling fit with SATS’ gateway capabilities.

5.2 SATS will connect its operations at Changi Airport with the SCCPL in order to enhance the service experience of cruise lines and their passengers. By extending its Cruise-Fly™ and Fly-Cruise products to SCCPL, more passengers will be able to enjoy convenient, seamless transfers to and from Changi Airport. There will also be opportunities for SATS to provide gateway and ship supplies provisioning services to support more cruise lines, hence creating strong homeport opportunities for Singapore.

5.3 As SCCPL complements SCCS’ current cruise terminal operations, the combined entity will have the potential to improve efficiencies, optimise the efficient utilisation of berths and resources, and attract more cruise lines to choose Singapore as a regional homeport. The combined entity will also work with industry stakeholders to jointly promote Singapore as a regional cruise hub.

5.4 The positive outlook for the cruise sector in Singapore and the region presents attractive opportunities for SATS, with encouraging trends in both cruise ship arrivals and passenger throughput. 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. With the Acquisition, the combined entity will be well-positioned to compete with the regional cruise terminals to benefit from this growth.

6. FINANCIAL EFFECTS AND FUNDING

6.1 Assumptions: The pro forma financial effects of the Acquisition on the net tangible assets (“NTA”) per share and the earnings per share (“EPS”) of SATS and its subsidiaries (the “Group”), as set out below, are prepared purely for illustrative purposes only and do not reflect the actual financial position of the Group post-Acquisition. The pro forma financial effects have been prepared based on the audited consolidated statements of the Group for FY2012-13.

6.2 NTA: For illustrative purposes and assuming that the Acquisition had been effected on 31 March 2013, the pro forma financial effects on the consolidated NTA of the Group for FY2012-13 are as follows:

Before the After the After the Acquisition Acquisition Acquisition (Call Option (Call Option Not Exercised) Exercised) NTA (S$ million) 1,119 1,032 1,047

NTA1 per share (Singapore cents) 100.5 92.6 94.0

6.3 Earnings: For illustrative purposes only and assuming the Acquisition had been effected on 1 April 2012, the pro forma financial effects on the consolidated earnings of the Group for FY2012-13 are as follows:

Before the After the After the Acquisition Acquisition Acquisition (Call Option (Call Option Not Exercised) Exercised) Profits after tax and minority interest 185 194 191 (S$ million)

EPS2 (Singapore cents) 16.6 17.5 17.2

6.4 Funding:

6.4.1 It is currently contemplated that SATS, through SAS and SCCS, will be funding its portion of the Aggregate Consideration through internal cash resources. The portion of the Aggregate Consideration to be paid by SATS comprises S$106,500,000 in the aggregate, being the sum of:

(i) S$101,250,000, the amount to be paid to the Vendor by SAS directly; and

1 Based on 1,113,580,258 shares (excluding treasury shares) of SATS in issue as at 31 March 2013. The calculations have been made without taking into account the exercise of options granted under the share option plan, or the release of awards granted under the restricted share plan and the performance share plan, each implemented by SATS. 2 Based on 1,110,990,272 weighted average number of shares of SATS in issue during the financial year ended 31 March 2013. The calculations have been made without taking into account the exercise of options granted under the share option plan, or the release of awards granted under the restricted share plan and the performance share plan, each implemented by SATS.

(ii) S$5,250,000, the amount to be paid by SAS to SCCS through an equity injection, for payment of SCCS’ portion of the Aggregate Consideration.

6.4.2 The balance portion of the portion of the Aggregate Consideration to be paid by SCCS, being S$3,500,000, will be paid by Creuers to SCCS through an equity injection.

6.4.3 In the event that SCCS fails to complete the Acquisition for any reason whatsoever, SATS shall, through SAS, fund the whole of the Aggregate Consideration through internal cash resources.

7. DISCLOSEABLE TRANSACTION

The relative figures in relation to the Acquisition computed on the applicable bases set out in Rule 1006 of the Listing Manual of the Singapore Exchange Securities Trading Limited (the “Listing Manual”) are as follows:

Rule Bases The Acquisition Group (S$ Relative Figures (%) 1006 (S$ million) million)

(a) Net asset value of the N.A N.A N.A assets disposed of, compared with the Group’s net asset value

(b) Net profits 3 attributable 4.5 50.9 8.8 to the Sale Shares, compared with the Group’s net profits

(c) Aggregate 110.0 3,563 3.1 Consideration to be given, compared with SATS’ market capitalisation as at the Latest Practicable Date (as defined below)

(d) Number of equity N.A N.A N.A securities issued by SATS as consideration for the Acquisition, compared with the number of equity securities previously in issue As one of the relative figures under Rule 1006 above exceed five per cent. but do not exceed 20 per cent., the Acquisition constitutes a discloseable transaction under Chapter 10 of the Listing Manual.

3 Pursuant to Rule 1002(3) of the Listing Manual, the term “net profits” means profit or loss before income tax, minority interests and extraordinary items, as taken from the latest announced consolidated accounts for 1st quarter FY2013-14.

8. INTERESTED PERSON TRANSACTION

8.1 Interested Person Transaction: The Vendor is an indirect wholly-owned subsidiary of Temasek Holdings (Private) Limited (“Temasek”). As at 25 September 2013, being the market day immediately preceding the date of this Announcement (the “Latest Practicable Date”), Temasek holds, indirectly, through Venezio Investments Pte Ltd (“Venezio”), 479,096,858 shares in the capital of SATS (“SATS Shares”), representing approximately 42.7 per cent. of all SATS Shares (excluding treasury shares). Accordingly, as Temasek is a controlling shareholder of SATS (as defined in the Listing Manual) and each of Venezio and the Vendor are associates (as defined in the Listing Manual) of Temasek, the Acquisition is an interested person transaction for the purposes of Chapter 9 of the Listing Manual.

8.2 Shareholders’ Approval: As the Aggregate Consideration (being the amount at risk to SATS in the Acquisition) represents more than five per cent. of the latest audited consolidated NTA of the Group of approximately S$1,209 million as at 31 March 2013, pursuant to Rules 906 and 918 of the Listing Manual, SATS must obtain Shareholders’ Approval prior to Completion. Pursuant to Rule 919 of the Listing Manual, each of Venezio and its associates are required to abstain from voting on the resolution to grant Shareholders’ Approval.

8.3 Current Total of Interested Person Transactions: In the current financial year to the Latest Practicable Date the current total of all:

8.3.1 transactions between the Group, on the one hand, and the Vendor and/or its associates, on the other hand is S$368,650; and

8.3.2 interested persons transactions is S$368,650.

8.4 Independent Financial Adviser: In accordance with Rules 917(4)(a)(ii) and 921(4)(a) of the Listing Manual, an independent financial adviser (the “IFA”) will be appointed to advise the Directors of SATS who are considered independent for the purposes of the Acquisition as to whether the Acquisition is on normal commercial terms and is not prejudicial to the interests of SATS and its minority shareholders.

8.5 Audit Committee: The Audit Committee will be obtaining an opinion from the IFA before forming its view on whether the Acquisition is on normal commercial terms and is not prejudicial to the interests of SATS and its minority shareholders.

8.6 Meeting and Circular: A circular to shareholders (“Circular”) setting out the terms of the Acquisition, the opinion and recommendation of the IFA and the notice of the meeting to be convened (or any adjournment thereof) will be despatched to shareholders in due course. In the meantime, shareholders are advised to refrain from taking any action in relation to their SATS Shares which may be prejudicial to their interests until they or their advisers have considered the information and the recommendations to be set out in the Circular.

9. FURTHER INFORMATION

9.1 Directors’ Service Contracts: No person is proposed to be appointed as a Director of SATS in connection with the Acquisition. Accordingly, no service contract is proposed to be entered into between SATS and any such person.

9.2 Interests of Directors and Controlling Shareholders:

9.2.1 Mr. David Heng Chen Seng, a non-executive, non-independent Director, is also the Co-Head, Markets Group; Senior Managing Director, Investment and Head, SEA, of Temasek International Pte. Ltd. Accordingly, Mr. David Heng Chen Seng will be abstaining from making a recommendation on the Acquisition to the shareholders of SATS, and will also refrain from voting his shares in the capital of SATS (if any) on the Shareholders’ Approval. Further, Mr. David Heng Chen Seng will not accept any appointment to act as proxy or otherwise for voting on the Shareholders’ Approval, unless specific instructions have been given on the proxy form(s) on how the votes are to be cast in respect of the Shareholders’ Approval.

9.2.2 Save as disclosed in this Announcement, none of the Directors or controlling shareholders of SATS has any interest, direct or indirect, in the Acquisition.

9.3 Documents for Inspection: Copies of the Sale and Purchase Agreement are available for inspection during normal business hours at the registered office of SATS at 20 Airport Boulevard, SATS Inflight Catering Centre 1, Singapore 819659, for a period of three months commencing from the date of this Announcement.

BY ORDER OF THE BOARD Prema d/o K. Subramaniam

Company Secretary

26 September 2013