Bangkok--Apr 29--PTT
PTT Public Company Limited (PTT) and the Ministry of Finance (MOF), in its capacity of an agent authorized by the Thai Petrochemical Industry Public Company Limited (TPI) Business Reorganization Plan (Plan) to select and allocate TPI shares to new qualified investors, have reached an agreement on the indicative price and major terms of the Share Purchase Agreement (SPA) under which PTT will acquire 31.5% ownership interest in TPI (diluted to 30% ownership post the issuance of ESOP shares). PTT intends to subscribe to approximately 6,143 million shares of TPI at an indicative price of THB3.30 per share, equivalent to approximately THB20.3 billion (approximately US$520 million) for the entire 31.5% ownership interest. The transaction and the indicative THB3.30 per share offer are subject to satisfactory confirmatory due diligence and the terms and conditions of the SPA to be agreed upon.
PTT expects to finalize the terms and conditions of SPA by May 30, followed by the execution of SPA with other investors, TPI and the selling shareholders in June 2005. Both PTT and MOF are committed to meeting all key milestones and consummating the transaction in a timely and efficient manner. The payment for TPI shares will take place after the successful completion of the Plan, but no later than November 4, 2005 in accordance with the timeline set out in the Plan. Upon a successful closing of the transaction, PTT, together with the Government Pension Fund and Government Saving Bank, will own over 50% of TPI.
In its assessment of the proposed investment, PTT has conducted detailed due diligence on TPI’s existing operations, business plan and projected financials to ensure that the investment satisfies its 15% rate of return threshold and other internal investment guidelines. Khun Prasert Bunsumpun, President of PTT, emphasizes that “through this investment, PTT intends to leverage TPI’s existing business platform and further expand itself into a fully integrated petrochemical business. It is PTT’s objective to strengthen TPI’s existing operations through upgrading production facilities, maximizing operational efficiency and enhancing value of under-utilized assets. PTT aims to achieve potential synergies in, among other areas, the procurement of crude and feedstock, and marketing and trading of refined oil and petrochemical products. As the largest shareholder of TPI and given its strategic position in the petroleum and petrochemical businesses, PTT will assume management responsibility of TPI to ensure a smooth and efficient operational transition, improve TPI’s competitive position, maintain high corporate governance standards and increase shareholder value.”
To evaluate this investment opportunity, PTT has retained Phatra Securities Public Company Limited and Citigroup Global Markets Asia Limited as domestic and international financial advisors respectively, Linklaters (Thailand) Limited as legal counsel, KBC Advanced Technology Pte Ltd as technical consultant, and Deloitte Touche Tohmatsu as independent auditor.
Corporate Public Relations Department
PTT Public Company Limited End.