Shareholders have overwhelmingly rejected Temasek Holdings' mandatory offer for the outstanding shares in Sembcorp Marine.

The sovereign wealth fund said in a regulatory filing that it received valid acceptances for around 8% of the total number of the Singapore-listed shipyard group's outstanding shares.

This, taken together with the shares owned, controlled, acquired or agreed to be acquired by Temasek, amount to about 17.1bn shares, representing 54.6% of the total number of issued shares.

Temasek said after the close of the mandatory offer that Sembcorp Marine will remain listed on the Singapore Exchange.

In the summer, Sembcorp Marine's shareholders voted in favour of a SGD 1.5bn ($1.1bn) rights issue at SGD 0.08 per share. Temasek took up 49.3% of the issue, taking its stake to 46.6% and triggering a mandatory offer under Singapore's takeover code.

Temasek's offer, made on 22 September, was made at the same level as the rights issue price. Sembcorp Marine shares are currently trading at that price.

Provenance Capital — Sembcorp Marine's independent financial advisor — had declared the offer "not fair and not reasonable".

Temasek said the offer price was final and it would not revise the offer price or any other terms of the offer, including extending the closing date.

Morgan Stanley Asia (Singapore) acted as the sole financial advisor to Temasek in connection with the mandatory offer.

The focus for Sembcorp Marine will now turn to winning more orders and its proposed merger with the offshore operation of Keppel Corp.

DBS, Singapore's largest bank, recently said that order wins were the key indicator for recovery, as Sembcorp Marine's order backlog was running low at SGD1.6bn, barely enough to cover one year's revenue.

"We are seeing positive signs with new orders picking up from nil in 2020 to SGD 600m in the first half of 2021. Growing offshore renewable orders is a strategic move for long-term growth," said analyst Pei Hwa Ho.

After the signing of a non-binding agreement in June 2021, Sembcorp Marine and Keppel are expected to release more details on a proposed merger by the end of the year.

"We believe the merger is long-term positive for [Sembcorp Marine], creating revenue and cost synergies. However, in the near term, some uncertainties hover around the valuation of yards and potential integration hiccups," Ho said.

Keppel Corp said in its third-quarter update that the merger talks were "progressing steadily" and it hoped to complete by the end of the year, but warned that this could slip.