Gortune International Investment Holding Company, a prominent Chinese group, plans to invest a total sum of 1.4 billion baht to eventually acquire up to 49.9% of SET-listed Finansia X (FSX), becoming the largest shareholder of the Thai securities group.
FSX chief executive Chuangchai Nawongs said Gortune Group, with shareholders' equity of 16 billion yuan (roughly 80 billion baht), and affiliates will acquire up to 228 million of FSX's existing shares from current shareholders, as well as new capital shares through private placement (PP).
The transaction, which is expected to be completed early next year, would give Gortune 46% of FSX, making FSX and Finansia Syrus Securities a regional hub for the Chinese firm to expand its business in Southeast Asia, he said.
A strategic partnership with Gortune would enhance FSX's competitiveness amid challenges in the financial services sector, said Mr Chuangchai.
Technological advancement will be the key driver for FSX, a holding company that invests in securities businesses and affiliates to attract customers in order to drive growth, he said.
"A strategic partnership with Gortune would enhance FSX's competitiveness amid challenges in the financial services sector,'' says Chuangchai Nawongs, chief executive, Finansix X.
In the next stage, FSX aims to raise an additional 1.99 billion baht through a rights offering (RO) at a ratio of 1:1 for 2.3 baht apiece. Gortune will exercise its right and subsequently become the largest shareholder of FSX with a 49% interest.
Pilgrim Finansa Investment Holdings PTE, FSX's existing major shareholder, will significantly dilute its ownership in FSX after the PP and RO.
The financial business arm encompasses GF Securities (a Gortune subsidiary), a top five broker in China with more than 14,000 employees and 349 branches. Its mobile trading app has more than 40 million users.
GF Securities is one of the most influential securities companies in China while its subsidiary, GF Fund Management, ranks among the top three asset management firms in the mainland.
FSX is in seeking shareholders' approval to authorise the issuance of new shares and the related transaction, said Mr Chuangchai.
Gortune, meanwhile, must seek approval from the relevant authorities for the request to waive fees to make a tender offer for all securities of FSX, relying on the resolution of the shareholders' meeting. This process is expected to take roughly three months, he added.
"FSX shares similar business visions and directions with Gortune and anticipates strong synergies between the parties," said Mr Chuangchai.
On the completion of these proceedings, a comprehensive business plan will be formulated to outline the strategy for FSX to realise its aforementioned objectives.
This strategic vision aims to establish the group as a prominent securities house in Thailand in a sustainable manner, he added.