Thailand's TCC makes $7.2 billion bid to buy F&N

SINGAPORE Wed Sep 12, 2012 7:37pm EDT

The logo of Tiger beer is pictured on a can of ice cold beer in Singapore July 20, 2012. REUTERS/Tim Chong

The logo of Tiger beer is pictured on a can of ice cold beer in Singapore July 20, 2012.

Credit: Reuters/Tim Chong

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SINGAPORE (Reuters) - A group linked to Thai billionaire Charoen Sirivadhanabhakdi made a $7.2 billion cash offer to take over Fraser and Neave Ltd (FRNM.SI), two weeks ahead of a crucial shareholder vote on Heineken NV's HEIN.SI separate offer for F&N's key beer business.

The offer came after Thai Beverage PCL (TBEV.SI) and TCC Assets, the vehicle linked to the billionaire, increased their combined stake in F&N to 30.36 percent, according to a stock filing to the Singapore Exchange.

Under Singapore law, a bidder has to make a mandatory offer for a company if it buys a 30 percent stake.

"We believe the offer represents an opportunity for F&N shareholders to realize the value of their investment in cash and to make a complete exit from F&N," said Thapana Sirivadhanabhakdi, ThaiBev's president and chief executive officer, in a statement on Thursday.

TCC assets offered to buy the rest of F&N for S$8.88 a share, the same price ThaiBev paid to buy a 22 percent stake in F&N from Singapore's Oversea-Chinese Banking Corp (OCBC.SI) in mid-July. It represents a premium of 4.3 percent to F&N's last traded price.

The offer could complicate Heineken's $6.3 billion bid for Asia Pacific Breweries Ltd APBB.SI, in which F&N has a 40 percent stake. F&N shareholders will vote on the proposed sale of the APB stake to Heineken on September 28.

ThaiBev did not discuss Heineken's offer for APB in its statement. ThaiBev, which controls 29 percent of F&N, has not indicated how it will vote at the shareholder meeting.

For two months, ThaiBev and Heineken fought for control of Asia Pacific Breweries, the maker of Tiger beer. Eventually, Heineken sweetened its offer to $6.3 billion and won over F&N, which agreed to sell its APB stake to the Dutch brewer.

The deal requires approval from F&N shareholders, including ThaiBev and Japan's Kirin Holdings Ltd (2503.T).

Analysts have said before that Charoen is interested in F&N's property portfolio, worth more than S$8 billion, as well as its beverage business.

Blackstone Group LP (BX.N) and other global property companies have also had a look at F&N's property business, sources previously told Reuters, while F&N's beverage business has attracted suitors, including Coca-Cola Co (KO.N) and Kirin Holdings Co Ltd (2503.T).

Besides market-leading positions in soft drinks and dairies in Singapore, Malaysia and Thailand, F&N also has distribution reach in emerging markets such as Vietnam and Myanmar.

ThaiBev, which took a bridge loan to finance the F&N stake purchase earlier, said it would not incur any additional debt for the transaction.

TCC Assets advisers DBS Group Holdings Ltd (DBSM.SI) and United Overseas Bank Ltd (UOBH.SI) said in the filing that the group has sufficient financial resources available for the bid. Morgan Stanley (MS.N) is also advising the bidder.

(Reporting by Eveline Danubrata and Saeed Azhar. Editing by Andre Grenon)

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