Switzerland's Holcim Ltd has agreed to sell out its 27.5% stake in SET-listed Siam City Cement Plc (SCCC), the bulk of which will be acquired by an affiliate of Hong Kong-based conglomerate Jardine Matheson Holdings Ltd in an exit deal valued at 22.15 billion baht.
Singaporean-listed car dealer Jardine Cycle & Carriage Ltd will acquire 57.27 million shares or 24.9% of the country's second-largest cement maker from wholly owned Holcim subsidiary Thai Roc-Cem Co for 350 baht apiece, SCCC said in a statement to the Stock Exchange of Thailand yesterday.
The selling price is at the bottom end of an indicative range of 350-381 baht and lower than last Friday's closing price of 358 baht.
An investment banking source said Jardine Cycle planned to buy a 24.9% stake in SCCC to avoid launching a tender offer.
Ratanarak Group owns a combined 104.36 million shares or 45.37% of SCCC.
Securities and Exchange Commission rules stipulate those buying stakes in Thai-listed firms at the triggering thresholds of 25%, 50% and 75% are obliged to make a mandatory tender offer for the remaining shares.
The investment banking source said Jardine Cycle was making the acquisition for investment purposes and expected a good return on investment due to SCCC's growth potential.
The deal will pave the way for Jardine Cycle to enter the Thai market as part of a regional expansion.
Jardine Cycle has motor businesses in Singapore, Malaysia and Myanmar and other interests through PT Tunas Ridean in Indonesia and Truong Hai Auto Corporation in Vietnam.
It owns just over half of PT Astra International, an Indonesian conglomerate with interests ranging from automobiles to agribusiness.
The remaining 2.6% of Thai Roc-Cem's stake will be bought by several institutional investors at the same price, SCCC said, adding that the deal would have no effect on the company's management structure or operations.
An analyst at a local brokerage said the deal could be a win-win for Jardine Cycle and the Ratanarak family.
Jardine Cycle wants to avoid a tender offer and the family to retain its status as the biggest shareholder in SCCC, the analyst said.
In a filing with the Singapore Exchange, Jardine Cycle said the deal was expected to conclude on April 16.
SCCC shares closed yesterday on the SET at 377 baht, up 19 baht, in trade worth 407 million baht.