SET-listed developer KC Property Plc's major shareholder and president, Chai Ngamarchariyakul, and his group will sell a 58.76% stake to an investor for 1.34 billion baht.
However, the SET yesterday suspended the stock from trading, as the company had not provided required information including the buyer's profile, business and management structure after the acquisition as well as details regarding the tender offer.
In a filing with the SET, KC reported Mr Chai and his group entered into an agreement to sell 514.16 million shares to Pattarapob Ittisanyakorn for 2.61 baht apiece.
That price is almost half of KC's closing price of 5.20 baht last Friday. The stock price more than tripled over the past five trading days from 1.55 baht at the end of last year. Several times, the company has been rumoured to have new buyers.
Mr Pattarapob will complete the share transfer within 60 days after the agreement was signed or by March 9, the filing said, adding that the company had not been notified of future changes to its business operations.
Executive director Somchai Vanavit blamed the split on the Ngamarchariyakul family's conservative policies.
"When the majority shareholder listed KC's shares, [Apisit Ngamachariyakul] thought it would be good, but we're too conservative for that," he said.
Last year the company launched only two new low-rise housing projects on newly acquired plots, each 20-30 rai in Bangkok's Nong Chok district, with project values of 400-500 million baht each.
Apisit Ngamachariyakul, a former managing director of KC and the father of Mr Chai, did a backdoor listing on the SET in 2005 through the now-defunct Modernhome Development. KC was established in 1982.
Mr Apisit hoped the company would pay less in taxes by listing, but the corporate income tax rate for listed and non-listed firms is now the same.
He was in talks with many new investors over five years interested in buying KC shares.
Mr Chai and the Ngamarchariyakul family did not discuss whether the company would continue in property development after selling the KC shares.
The family owns more than 10 real estate firms with a large number of plots in eastern and northeastern Bangkok, in Min Buri, Nong Chok, Suwintawong, Lat Krabang, Klong Sam Wa, Theparak and Bang Na.
"This is normal SET practice, launching a probe when there is a sharp gain in share price to check on stock manipulation or insider trading," said Supakit Jirapraditkul, an executive vice-president of KC.
The SET included KC in its trading alert last Tuesday. The trading alert list, which took effect the day before, requires alerted stocks to be restricted to trading in cash for three weeks. A second alert means another three-week restriction, and the stock is excluded as collateral from trading account calculations.
"The company's report seemed to contain significant information that could affect the business and decision-making of investors, but the information was insufficient," SET president Kesara Manchusree said.