Jurisdiction - Thailand
News
Allen & Overy Advises Bank of Tokyo Mitsubishi On USD 5.8bn Offer For Thai Bank.

4 July, 2013

 

Allen & Overy is advising The Bank of Tokyo Mitsubishi UFJ, Ltd (BTMU) on its voluntary tender offer (VTO) for The Bank of Ayudhya Public Company Limited (Krungsri), a major commercial bank listed on the Thai Stock Exchange. The deal is valued at up to USD5.75 billion, which will make it the largest acquisition in Asia to date by a Japanese bank.
 
The deal, which is subject to regulatory approvals, corporate approvals and fulfillment of certain conditions, will see BTMU launch a VTO for Krungsri, with the aim of acquiring a majority stake in the bank. BTMU has agreed with GE Capital International Holdings Corporation (GE) that they will tender their stake of approximately 25.33% in the VTO.
 
The transaction, targeted for completion in December 2013, will see BTMU replace GE as a major shareholder in Krungsri and partner with the Ratanarak Group, an existing group of major shareholders which is not currently expected to tender its shares in the VTO.
 
Following completion, BTMU will be required under Thailand’s One Presence Policy to integrate its existing Thai operations into Krungsri. BTMU and Krungsri will discuss the potential integration of BTMU’s existing Bangkok Branch, which would take place following the completion of the VTO.
 
The transaction forms part of BTMU’s wider strategy to develop its business in Asia. The investment in Krungsri aims to develop a strong commercial banking platform which can provide a fully-fledged and comprehensive consumer and commercial banking service both in Thailand and the Greater Mekong region.
 
Commenting on the deal, Tokyo-based partner Simon Black said:  “We are delighted to be advising BTMU on such a strategically important investment in a comprehensive commercial banking platform in Thailand and the Mekong region. This is a landmark transaction for Japanese investment in South East Asia.  These types of transactions play well to our traditional strength in top-level financial institution M&A, which we are able to combine with the local regulatory and banking expertise provided by our network. These transactions are always challenging, but these sorts of complex, cross-border transactions are what our network is geared to deliver.”
 
Bangkok-based partner, Suparerk Auychai added: “This is an important deal for Thailand as it is potentially the largest banking transaction in the country to date and when completed it will provide Krungsri with an enhanced platform from which to deliver financial services across the Greater Mekong region.”
 
The Allen & Overy team, on behalf of BTMU, was responsible for structuring and regulatory advice, the negotiation of transaction documents and carrying out due diligence on Krungsri. The team is also playing a lead role in discussions with the Thai regulators.
 
Partners Suparerk Auychai (Bangkok) and Simon Black (Tokyo) and Senior Associate Alun Evans (Singapore) led the team with support from lawyers Noparat Kaewsringarm, David Norman, Arthit Hemara, Vorasaree Wangwittaya, Nonnabhat Paiboon, Pannalin Jantadee, Purita Thanachoksopon and Chris Burkett.
 
Other law firms with a significant role on the transaction include:

Nishimura & Asahi (Japanese law) for BTMU.  King & Wood Mallesons and Thanathip & Partners for GE.

 

For further information, please contact:

 

Susan Byrnes, Allen & Overy
susan.byrnes@allenovery.com 

 

Comments are closed.