Amarin Printing and Publishing Plc has agreed to sell new shares in a private placement that will make Thailand's second-richest man its majority shareholder for 850 million baht.
The loss-ridden magazine publisher and digital TV operator told the Stock Exchange of Thailand on Friday that its board had decided to almost double its capital to 420 million baht from 220 million.
It will issue and sell 200 million new shares to Sirivadhanabhakdi Co, an investment arm of Thapana Sirivadhanabhakdi and Panote Sirivadhanabhadkdi, sons of beer and property tycoon Charoen Sirivadhabhakdi, at 4.50 baht each. The offering price was a 43.11% discount given the company's accumulated losses.
The 850-million baht-deal will give Sirivadhanabhakdi Co 47.62% control in the company if the deal is approved by Amarin's shareholders' meeting.
Accumulated losses over the past few years have resulted in a liquidity crunch as its debt-to-equity ratio shot up to 4.32 times at the end of September, the company said. Its total liabilities at the end of September was 1.97 billion baht.
The funds raised from the sale would go to financing its fledging, capital-intensive digital-TV operation.
Amarin attributed the high costs to the licence fee, investment in a broadcasting network, loan repayments and operational costs.
With fierce competition in the digital TV business, Amarin said, it is good for the company to have a financially strong partner with business expertise and connections with a wide range of business operators.
"With the capital support from Mr Thapana and Mr Panote, who are experienced in various businesses both locally and internationally, our organisation will be stronger and more competitive," said Amarin chief executive Rarin Utakapan.
The new partner would keep Amarin's present management and appoint new directors to strengthen the organisation, she said.
The board also resolved to ask shareholders to approve the "whitewash" resolution for the waiver of the requirement to make a tender offer as the buyer does not wish to do so, it said.
Currently, the Utakapan family is the largest shareholder group of Amarin, with a combined 58.87% of shares as of March 11 this year.
Amarin is the publisher of Praew women's magazine and Baan Lae Suan home-improvement magazine. It also operates the HD34 Amarin TV.
AMARIN shares fell 1.34% to 7.35 baht in trade worth 323.25 million baht before the announcement was made on Friday.