The Financial Institutions Development Fund (FIDF) has approved Thanachart Bank Pcl. (TBANK) to buy its shares in Siam City Bank (SCIB), after reviewing bids from several parties and concluding that Thanachart Bank’s bid represented the most suitable in terms of qualifications, future business plan and offered share price. Publicly listed Thanachart Capital Pcl owns approximately 51% of TBANK with Canada’s Scotiabank owning the remaining 49%.
Following their careful consideration of all bidders’ qualifications, business plans and share prices, among other matters the Financial Institutions Development Fund (FIDF) and Thanachart Bank Pcl today executed the Share Purchase Agreement whereby, subject to Bank of Thailand approval, Thanachart Bank will purchase 1,005,330,950 million SCIB shares from FIDF, accounting for 47.58% of the registered and paid-up capital of the bank.
The next step for Thanachart Bank is to seek approval for the acquisition from Bank of Thailand and the shareholders of Thanachart Bank and Thanachart Capital..Upon completion of the of the acquisition of the 47.58% of SCIB from FIDF, TBANK, in line with securities regulations, will launch a tender offer to acquire the remaining outstanding SCIB shares from other existing shareholders and transfer the banking business of SCIB to TBANK. This will help TBANK build a solid platform for long-term growth and stability in line with the Bank of Thailand’s One Presence Policy.
The acquisition will help TBANK to further enhance its position as a leading commercial bank through sustainable growth by bringing together the strengths of SCIB in corporate banking, mortgage lending and their branch infrastructure with the leading TBANK presence in retail banking and bancassurance to create greater benefits for the customers, employees and shareholders of both banks, which will in turn strengthen the Thai financial industry in the long term.
Speaking on TBANK’s successful bid, Banterng Tantivit, Thanachart Bank Chairman said, “TBANK is honored to be selected by FIDF to buy the shares of SCIB and would like to thank all concerned parties who have helped us along the way during the bidding process.”
After the merger of TBANK and SCIB, the bank will focus on combining SCIB’s branch infrastructure and strength in corporate banking with TBANK’s retail banking portfolio and expertise in automobile hire purchase business. The combined assets of both banks will stand at over 800 billion baht, making TBANK the fifth largest commercial bank in Thailand, with a network of over 600 branches and 2,100 ATMs. This growth will enable TBANK to better serve its customers and strengthen its capabilities for future growth and ranking amongst the top commercial banks in the country.
“We are fully committed to making this merger smooth and in accordance with the Bank of Thailand’s One Presence Policy. The move is a positive development for all involved and will bring together two stable banks with high-value assets. In addition, the well-experienced and expert employees of TBANK and SCIB will be working hard to ensure that all concerned parties – customers, shareholders and employees – benefit positively from TBANK’s growth,” continued Banterng.
On behalf of Scotiabank, Michelle Kwok, Scotiabank’s Senior Vice President, Asia/Pacific and the Middle East commented, “Just over one year ago we increased our stake in Thanachart Bank to 49 per cent, and today we are seeing once again the growth opportunities that are present in the attractive Thai market. We look forward to the opportunity to work with our colleagues at Thanachart Bank and Siam City Bank and build on our abilities to serve this market and our over 4 million customers in Thailand.”