Thailand’s Ratanarak Group now has a controlling stake in Siam City Cement after buying Singapore-based Jardine Cycle & Carriage’s 25.54% holding for 12.18 billion baht ($353.97 million).
The move, announced by Siam City on Monday, takes Ratanarak Group’s stake to 71.88%.
Siam City shares surged as much as 9.4% to 156 baht on the news, hitting their highest level since February 2023.
Under the deal, Ratanarak unit Sunrise Equity bought 76.1 million shares in Siam City for 160 baht apiece, valuing the cement manufacturer at 47.68 billion baht.
The offer price reflects a premium of 11.5% to Siam City’s last close on Friday.
Analysts at Jefferies however, viewed the purchase price of 160 baht apiece as low adding that Siam City’s earnings are expected to grow assuming flat coal prices and reduced expenses from cost cutting programmes.
Shares in Jardine Cycle, which had been the second largest shareholder in Siam City, gained as much as 1.7% to S$27, their highest level since late June.
Jardine Cycle bought its stake in 2015 and its sale returns Siam Cement ownership to Ratanarak Group, which originally set up the cement maker.
The sale is “consistent with Jardine C&C’s strategy to evolve its portfolio in line with its long-term growth and sustainability objectives”, the automotive retailer said in a bourse filing on Friday.
Cash proceeds from the proposed sale will be used for Jardine’s internal funding requirements.
The Ratanarak family has significant holdings in numerous Thailand-based firms including Allianz Ayudhya Capital AYUD.BK and Eastern Star Real Estate ESTAR.BK.
The group was set up by the late Chuan Ratanarak, who also founded Bank of Ayudhya BAY.BK as well as Siam City Cement.
($1 = 34.4100 baht)
Reuters
