SINGAPORE – Sembcorp Industries said on Monday that it had commenced a process for a possible divestment of its waste management business and its energy from waste plants, in a filing before the Singapore stock market opened.

The company, however, added that while preliminary discussions with selected parties had begun, there is no certainty that any transaction will materialise.

Sembcorp said it will make the necessary announcements as appropriate or when there are any material developments regarding the potential divestment.

Sembcorp shares jumped when trading opened on Monday, hitting the day’s high of $5.365 at 9.16am. The counter closed at $5.35, up 16 cents, or 3.1 per cent.

Reuters in May reported that United States private equity group KKR & Co and Australia’s Macquarie Asset Management were among potential bidders for SembWaste in a deal that could value the unit at around US$500 million (S$675 million).

Sembcorp on Monday confirmed that HSBC has been hired as financial adviser for the potential sale of the unit, as reported earlier.

Reuters had also reported that the first round of non-binding bids was expected by early June.

Sembcorp said the potential divestment was part of its ongoing strategic initiatives to maximise shareholder value.