The Stock Exchange of Thailand (SET) will investigate trading that preceded the announcement of the country's largest takeover bid, the purchase of discount wholesaler Siam Makro Plc (MAKRO) by 7-Eleven chain operator CP All Plc (CPALL).
A shopper pushes a cart carrying goods at a Makro store in Bangkok. (EPA photo)
Siam Makro's shares rose 30% in the six trading sessions before CP All's $6.6 billion bid was announced.
The stock jumped 15% on April 17, while the volume of shares traded rose to 1.6 million, almost four times the six-month average. CP All, backed by Thai billionaire Dhanin Chearavanont, offered to buy Siam Makro for 787 baht a share on April 23.
"It's our job to investigate any irregularities," Charamporn Jotikasthira, president of the SET, said on Thursday. "We have seen that and begun the process to investigate it."
Korsak Chairasmisak, chief executive officer of CP All, and Suchada Ithijarukul, CEO of Siam Makro, were not available for comment after calls to their offices.
The deal would be the largest on record for a Thai company and the biggest takeover announced in Asia this year, data compiled by Bloomberg shows.
CP All's offer is 41% above Siam Makro's average price in the previous 20 days, a record premium for a retail deal in emerging Asia, according to data compiled by Bloomberg.
CP All shares climbed 4.5% to 40.75 baht at the noon trading break, poised to snap a two-day slide. Siam Makro declined 0.3% to 752 baht, heading for the first loss since April 9.
Mr Dhanin, 75, said on Wednesday that he agreed to buy Siam Makro at 787 baht a share, about 17% above market value, because he was confident that "what is expensive today will be seen as cheap tomorow".
"I know it seems expensive upon first consideration, but this will be similar to Big C Supercentre's purchase of Carrefour at what was at the time viewed as a high price." said Thailand's richest man.
The deal emerged just three months after the agriculture conglomerate completed the purchase of a 15% stake in Ping An, China's second-largest life insurer.
Charoen Sirivadhanabhakdi, left, and Dhanin Chearavanont (Bangkok Post file photos)
Meanwhile, Thai tycoon Charoen Sirivadhanabhakdi, founder of Thai beverage firm TCC Group and chairman of Fraser & Neave Ltd (F&N), appears to be competing with Mr Dhanin to acquire Siam Makro.
According to sources close to the matter, Mr Charoen is approaching banks for funding to make a counterbid for the discount-store operator but will not likely bid if the funding is not adequate.
(Late Thursday, however, Mr Charoen denied rumours that he was preparing a counter bid.
("Everything’s ended already. Submitting a counter bid now would disrupt our financial discipline," said Aswin Techajareonvikul, the president of Berli Jucker Plc, in a statement on behalf of Mr Charoen.)
Earlier this year, the 68-year-old whisky tycoon became chairman of Singapore-based F&N following his S$13.8 billion (330 billion baht) takeover of the 130-year-old property and beverage company. His wife, Wanna, 69, was named the vice chairman.
According to Forbes magazine, Mr Dhanin and his family were ranked 58th in this year's world's billionaires list with an estimated wealth of US$140.3 billion. Last year, Mr Dhanin was ranked at No 153 with an estimated wealth of $8.7 billion.
Mr Charoen was ranked at No 82, up from 184 in 2012. He has an estimated wealth of $11.7 billion, rising from $5.5 billion counted by Forbes last year.