Telcos Advanced Info and Thaicom hope investors reject parent companies' merger offer

Author: Rishav Chatterjee

(Reuters) – Thai mobile operators Advanced Info Service and Thaicom said on Thursday their boards had asked investors to reject a combined offer to acquire their respective holding entities.

In July 2024, Thaicom's largest shareholder, power producer Gulf Energy Development, and Advanced holding company Intouch Holdings announced their intention to merge to create a new company to maximize the benefits of both companies and improve operations and investments .

The merger of Gulf and Intouch, which will create a new entity worth 1.037 trillion baht ($30 billion), has been approved by shareholders of Thai billionaire Sarath Ratanavadi's power company.

According to Forbes, Salas has a net worth of $15.1 billion, making him the fifth richest person in the country.

Gulf companies own about 47.4% of Intouch, followed by Singtel, which holds about 25%.

Gulf has formed a joint venture with Singtel and Advanced to build a local data center, which is expected to start operations this year.

Gulf Energy, Intouch and Singtel launched a takeover bid for Advanced, valuing the company at 216.30 baht per share, which was later reduced to 211.43 baht.

Gulf said in an emailed response to Reuters that its tender offer price was final and it did not intend to revise it.

Bay added that the independent financial adviser's recommendation to reject the takeover bid would not affect the merger process.

Advanced said its financial adviser found the revised price was below its estimated valuation range of 229.55 baht to 285.70 baht.

Advanced shares closed 1.1% higher at 290 baht per share on Thursday.

“The announcements by both companies are in line with market expectations. The share prices of both companies are higher than the tender offer, so the board advises investors to reject the tender offer. This does not pose a significant risk to the proposed merger.” SCB Asset Management Investment Research Group said Varoris Chirachon, the person in charge.

A similar tender offer was also launched as part of the restructuring, with Gulf Energy, Intouch and Sarath offering to acquire 58.9% of Thaicom's shares for 11 baht each.

Thaicom said the rise in its share price since the merger announcement was the main reason it asked shareholders to vote against the deal.

Its shares closed at 12.3 baht on Thursday.

Intouch and Singtel did not immediately respond to Reuters' requests for comment.

(1 USD = 34.5700 Baht)

(Reporting by Rishav Chatterjee in Bengaluru; Additional reporting by Aaditya Govind Rao; Editing by Mrigank Dhaniwala and David Evans)