Thai Beverage Public Company (ThaiBev), through its indirect wholly-owned subsidiary InterBev Investment (IBIL), has proposed a share swap with TCC Assets. The proposed share swap will involve no cash outlay from IBIL or ThaiBev.
ThaiBev will transfer to TCC Assets all of its 28.78% shareholding in Frasers Property TQ5 (FPL). TCC Assets will transfer its 41.30% shareholding in Fraser and Neave (F&N) to ThaiBev. Upon completion, ThaiBev will hold 69.61% of F&N compared to 28.31% previously. TCC Assets will own 86.89% of FPL (up from 58.10%).
The proposed share swap will be executed at a ratio of approximately 1.88 FPL shares for each F&N share. This ratio was determined based on a negotiated price of $1.89 per FPL share and $3.55 per F&N share.
F&N’s valuation range took into account a sum-of-the-parts (SOTP) approach, which valued each of its component businesses by applying their respective peers’ valuation multiples. This was also cross-checked against a standalone discounted cash flow valuation based on ThaiBev’s internal projections of the key businesses under F&N, interviews with management, and equity analyst and industry research reports.
FPL’s valuation range took into account, inter alia, FPL’s net asset value and latest available financial statements as at March 31 and related public disclosures, the latest market valuations of its stakes in its listed real estate investment trusts, the value of its asset management platform based on precedent transactions, applying a 20-25% discount to its revalued net asset value (RNAV), which is in line with previous privatisations of SGX-listed real estate companies by controlling shareholders.
ThaiBev has also received a ruling from the Securities Industry Council of Singapore that its subsidiary IBIL will not be required to make a general offer for F&N under Rule 14.1 of the Singapore Code on Take-overs and Mergers in connection with the proposed share swap.
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IBIL and the persons acting in concert with it would not be required to extend a downstream mandatory take-over offer to acquire all the remaining ordinary shares in Fraser & Neave Holdings Berhad not already owned by F&N pursuant to Note 3 of paragraph 4.01 of the Rules on Take-overs, Mergers and Compulsory Acquisitions of Malaysia.
The directors of ThaiBev who are independent for the purposes of the Proposed Share Swap have engaged Deloitte & Touche Corporate Finance as the independent financial adviser (IFA) in relation to the proposed share swap.
DBS served as ThaiBev's financial adviser.
On July 18, ThaiBev closed at 49 cents, FPL at 80 cents, and F&N at $1.07.
