Thai tycoon raises F&N offer, tops Overseas Union group's bid

SINGAPORE Fri Jan 18, 2013 12:38pm EST

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SINGAPORE (Reuters) - Thai billionaire Charoen Sirivadhanabhakdi increased his offer for Fraser and Neave Ltd (F&N) (FRNM.SI) to S$9.55 per share, valuing the Singapore property and drinks firm at nearly S$13.8 billion ($11.3 billion), to fend off a rival bid.

Charoen acquired an additional 90.8 million shares, or a 6.3 percent stake in F&N, at S$9.55 each on Friday.

The move raised Charoen's total stake in F&N - held through TCC Assets Ltd and Thai Beverage PLC (TBEV.SI) - to 40.45 percent, including acceptances from shareholders, TCC said in a statement issued in the early hours on Saturday. Charoen's previous offer was S$8.88 per share.

The end game is near for the four-month-long battle in the largest corporate acquisition in Southeast Asia.

A group led by Singapore property firm Overseas Union Enterprise Ltd (OVES.SI) had unexpectedly made a S$9.08-per-share counterbid for F&N in November, after Charoen offered in September to acquire F&N stock that he did not already own.

At stake is a 130-year-group with property assets worth more than S$8 billion as well as soft drinks, dairy and publishing businesses.

Thailand's third-richest man, worth $6.2 billion, is pitted against Overseas Union's chairman, Stephen Riady, who is also the president of the Lippo group of companies founded by his father Mochtar Riady.

PROTRACTED BATTLE

The fight for F&N has seen Charoen extend his earlier offer seven times and the Overseas Union group twice. The multiple extensions have tested the patience of F&N shareholders.

Singapore's Securities Industry Council had ruled that if neither party has declared its offer final by 5:30 p.m. on January 20, an auction will kick off on January 21.

F&N's independent financial advisor JP Morgan had previously said its sum-of-the-parts valuation of F&N is S$8.58 to S$11.56 per share. F&N stock last traded at S$9.58.

Kirin Holdings Co Ltd (2503.T), F&N's second-biggest shareholder with a stake of around 14.8 percent, has given its conditional support to the Overseas Union group.

The Japanese brewer will offer to buy F&N's food and beverage business for S$2.7 billion if the group's bid is successful. JP Morgan's valuation of the unit is S$1.88 billion to S$3.82 billion.

If Charoen wins control of F&N, analysts say he is likely to pursue cross-selling opportunities. This means he may tap F&N's distribution network in Singapore and Malaysia to sell his products, and he can market F&N brands in Thailand, where he already has an edge.

Charoen's Thai Beverage brews Chang Beer, second in Thailand in terms of market share by sales volume, on top of producing spirits, energy drinks and instant coffee. Charoen also has a sprawling property empire under TCC Land.

F&N is the leader in the soft drinks markets in Malaysia and Singapore, with a 31.3 percent and 21.4 percent market share, respectively, according to research firm Euromonitor.

($1 = 1.2232 Singapore dollars)

(Editing by Ryan Woo and Anshuman Daga)

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