SINGAPORE - Thai billionaire Charoen Sirivadhanabhakdi has increased his stake in Fraser & Neave Ltd to almost 40% and raised his takeover offer for the Singaporean real estate and soft-drink company to block a rival group.
Mr Charoen's TCC Assets has bid S$9.55 a share, topping a Nov 15 offer of S$9.08 from a group led by Overseas Union Enterprise Ltd, according to a statement made to the Singapore Exchange after the market closed on Friday.
The Thai liquor and property tycoon's latest offer is a 0.3% discount to Friday's closing price of S$9.58 and values the company at S$13.8 billion (US$11.2 billion).
F&N's wide range of popular beverage products marketed across the region make it an attractive takeover target. (Bloomberg Photo)
"I don't think it's game over for OUE," said Jonathan Foster, Singapore-based director of global special situations at Religare Capital Markets.
"It's in their interest to put their best foot forward because the Thais are not necessarily going to stay a minority shareholder if OUE bids above fair value for F&N."
Mr Charoen, Thailand's richest man, is seeking to expand his businesses in Asia by winning control of the 130-year-old company that has assets from serviced apartments to beverages.
His latest proposal escalates the bidding war with OUE, a Singapore-based property company that has enlisted the Japanese brewer Kirin Holdings Co in its bid.
The OUE-led group has the backing of Kirin's 15% stake in F&N. OUE would get the company's property business and Kirin would take the food and beverage unit, under a pact they announced last year.
Mr Charoen agreed to buy a 22% stake in F&N in July, sparking a fight for its assets. He has been adding to his holdings ever since. TCC said it had bought a further 6.3% of F&N and now owns or has acceptances for 39.94% of the shares.
F&N shares have traded above the price of the previous two offers, indicating that investors were expecting a higher bid. Mr Charoen had offered S$8.88 in September.
An auction process will begin on Monday if neither bidder has declared its offer final, Singapore's securities regulator said earlier this month. If one or other indicates its proposal is final by tomorrow, the deal will be decided by a shareholder vote.
If either group wishes to raise its offer after that date, it must submit the bid to the Securities Industry Council. The rival will have time to respond.
Kirin has agreed to tender its 14.8% stake in F&N, OUE has said.
The Japanese brewer will offer S$2.7 billion for F&N's food and beverage business, if OUE wins enough support to complete the takeover.
JPMorgan Chase & Co, F&N's independent financial adviser, said on Friday that Kirin's offer for the food and beverage business was 5.2% lower than the midpoint range of the value of the asset. The bank valued the unit at S$1.88 billion to S$3.82 billion, based on the sum-of-parts valuation.
F&N has said it had committed to pay the OUE consortium a break-up fee of as much as S$50 million if a competing offer is successful.
Mr Charoen, 68, has a net worth of $9.6 billion, according to data from the Bloomberg Billionaires Index. His unlisted business, TCC Group, has a real estate unit. His Thai Beverage, which makes Chang beer, obtains almost all its revenue from its home market.
OUE executive chairman Stephen Riady is a son of Mochtar Riady, who controls Indonesia's Lippo Group, with businesses ranging from real estate and financial services to food across Asia.
If successful, it would be the biggest-ever acquisition of a Singapore-based company, according to data compiled by Bloomberg.
OUE, which obtains about 65% of its revenue from hotel operations, plans at least one investment a year in Singapore to boost property holdings that include office towers, luxury apartments and malls, Stephen Riady said in an August interview.
Heineken won control of F&N's beer unit, the maker of Tiger beer, in a deal that closed in November.
Mr Charoen's aggressive pursuiit of Asia Pacific Breweries had forced Heineken's hand and made a handsome profit on the sale of his group's shares to the Dutch brewer.