TMB Bank Public Company Limited (TMB) has made a statement regarding the disclosure of Thanachart Capital Public Company Limited (TCAP) on the share purchase agreement of Thanachart Fund Management Company Limited (TFUND) on 30 September 2019, which is related to the merger transaction between TMB and Thanachart Bank Public Company Limited (TBANK).
On 30 September 2019 TBANK has, together with Government Savings Bank (GSB), who hold 75% and 25% shares in TFUND respectively, entered into a share purchase agreement with Prudential Corporation Holdings Limited (Prudential), an affiliate of Eastspring Investments (Singapore) Limited (Eastspring). The whole value of TFUND’s share purchase transaction is expected to be not less than THB 8,400,000,000.
The issued share capital of TFUND to Prudential and (ii) GSB agrees to sell its entire interest of 25% of the issued share capital of TFUND to Prudential. The total consideration for these transactions is THB 4,208,400,000. Following the transaction Prudential would own 50.1% and TBANK 49.9% of TFUND. Closing of these transactions is subject to meeting customary conditions including obtaining regulatory approvals and the completion of the purchase of shares in TBANK by TMB as part of the merger transaction disclosed to the SET on 8 August 2019.
It is the intention of the parties that in 2021 and following completion of the sale of shares in TFUND to Prudential, TFUND and TMB Asset Management Co., Ltd. (currently owned 65% by Prudential and 35% by TMB) would be merged, which, if completed, would create one of the largest asset management companies in Thailand (no. 4 based on AUM as at 30 August 2019).
TBANK and Prudential will enter into a shareholders’ agreement on completion of the sale of shares in TFUND mentioned above under which TBANK agrees to divest the remainder of its interest in TFUND or the merged asset management company (as the case may be) to Prudential through a predefined mechanism in the future.
TMB expects TFUND’s share sale transaction to complete after TMB closes its TBANK’s share purchase transaction and becomes a shareholder of TBANK. If that is the case, TMB would record TFUND’s sale transaction from TBANK as a subsidiary, through its consolidated financial statement ended 31 December 2019. For the whole value of 75% shares in TFUND that TMB will own at the closing of the TBANK’s share transaction date, it is expected to be not less than THB 6,300,000,000.
The sales of TFUND’s shares is part of the merger plan. The key objective is to emphasize the Merged Bank’s open architecture strategy. And as Eastspring is the mutual fund anchor partner of TMB, acquiring shares in TFUND would strengthen Eastspring’s capability and support the Merged Bank’s mutual fund services in providing customers best-in-class investment products.