Bangkok--1 Sep--The Siam Commercial Bank
The Siam Commercial Bank (“SCB”) announced today that it has reached an agreement to divest its entire shareholding in the Siam Industrial Credit Company Limited (“SICCO”) to Thai Credit Retail Bank Public Company Limited (“TCRB” or the “Buyer”). The sale is subject to approval of both the regulatory authorities and the shareholders of SICCO. The sale will be completed through a tender offer to all shareholders at a later date provided certain conditions are met. The preliminary tender offer price is Baht 4 per share, subject to further adjustment by the Buyer.
SCB holds 230,883,188 shares in SICCO representing 38.65% of the total paid-up share capital. In compliance with the One Presence Policy of the Financial Sector Master Plan, SCB is required to divest its shareholding in SICCO to 10% or less. Over the past few years, SCB has endeavored to conclude a sale of its shares in SICCO to either a foreign or local buyer, but for a number of reasons, particularly the constraints on the retention of the finance license by any potential buyer, these efforts were unsuccessful until the recent negotiations with TCRB.
The sale will be through a tender offer to all the shareholders and it will be contingent on a number of conditions being fulfilled prior to closure of the transaction, including prior regulatory approval, resolution of the SICCO shareholders in support of the merger with TCRB, and acceptance of its offer by shareholders representing at least 75% of the entire paid-up share capital of SICCO. TCRB plans to merge its operations with that of SICCO and its affiliates if its tender offer acceptances exceeds 75% of the entire paid-up share capital and provided that its merger plans are approved by at least 75% of the shareholders with voting rights who attend the extraordinary general meeting to be convened to vote on this matter. TCRB aims to enhance its competitive position as a result of the merger with SICCO. Following the successful conclusion of its tender offer , TCRB will return SICCO's finance license to the regulators.
The preliminary tender offer price to all shareholders of SICCO, including SCB, is set at Baht 4 per share. SCB views that this offer price fairly reflects the underlying value of SICCO to a potential buyer such as TCRB who already has a finance license. Also, the pricing reflects the relatively limited business prospects of SICCO in the increasingly crowded Hire Purchase market now dominated by the Thai commercial banks. SCB noted that the price is subject to revision depending on the outcome of further due diligence in specific areas by TCRB, particularly for additional impairment provisions and other unforeseen charges, prior to the formal tender offer being announced.
Siam Commercial Bank PCL is a leading universal bank in Thailand. It was established by Royal Charter in 1906 as the first Thai Bank and, as at August 30, 2010, had the highest market capitalization among Thai Financial Institutions (Baht 319.5 billion). It has the largest branch (1,003 as of August 31, 2010), exchange booth (115 as of August 31, 2010) and, ATM (7,527 as of July 31, 2010) network in the country, attesting to its dominant position in the retail financial services marketplace. It has a diverse range of Corporate, SME, Private, and Retail customers nationwide, and has an asset size of Baht 1,266 Billion as of June 30, 2010
Further information is available on the Bank's web site at www.scb.co.th.
Corporate Communications Division
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