SET-listed energy conglomerate Bangchak Corporation Plc (BCP) expects to generate synergy by combining its business with Esso Thailand and anticipates gaining an additional 3 billion baht from the move within 2025 following its recent acquisition of the company.
BCP plans to change the name of Esso-owned petrol stations to Bangchak in November.
The move follows the conclusion of the purchase of a 65.99% share in Esso Thailand, the operator of Esso petrol stations, from Esso Asia Holdings Pte for 22.6 billion baht.
BCP is also buying the other 34.01% stake via a tender offer from investors in the stock market at 9.89 baht per share between Sept 8 and Oct 12. The cost of the transaction is estimated at 11.6 billion baht.
Phatpuree Chinkulkitnivat, BCP's senior executive vice-president for accounting and finance, said the business synergy plan covers key issues in terms of economy of scale concerning back-office operation expenses and simplified management.
This will help BCP reduce costs by 1.5 billion baht a year, she said.
BCP will gain an additional 1 billion baht from oil refinery improvements, new oil products, gross refinery margin optimisation and a coordinated maintenance schedule, she added.
The company will also get 500 million baht from crude oil co-loading, the expansion of lower-cost logistics and growth in the value and volume of oil and non-oil trading.
Between September and December this year, BCP aims to gain 625 million baht through the business synergy and receive more next year until it reaches its goal of 3 billion in 2025, said Ms Phatpuree.
"In the long term, the synergy is expected to generate more revenue because there are many opportunities given by assets Bangchak gains from Esso such as an oil pipeline, oil storage and logistics facilities," she said.
Ms Phatpuree said the name of Esso-run petrol stations will be changed to Bangchak in November. As for Esso petrol stations operated by local investors, they can choose whether to run the business under the Bangchak brand or another oil retail brand.
She expects improved business prospects for the oil business in the last four months of 2023, which she attributed to a better oil refinery margin, a rise in oil trading and additional oil inventory gains.