BCP has announced plans to issue a tender offer aimed at acquiring the remaining 19% of shares in BSRC that it currently does not hold, which translates to approximately 631.86 million shares.
This strategic move will be underpinned by the issuance of new BCP shares, swapped at a rate of 6.5 BSRC shares for every one BCP share. This approach is expected to elevate BCP’s total shares outstanding by nearly 7%, reaching a total of 1,474.13 million shares.
Maybank Securities (Thailand) (MST) stated that according to recent closing prices, BCP’s offer values BSRC shares at THB5.61 each, reflecting a 14% premium over the present BSRC trading price. However, it’s important to note that this offer is priced at a 43% discount compared to a previous tender offer BCP extended in 2023.
Maybank’s perspective on this development remains neutral. While this acquisition could lead to a modest earnings per share (EPS) dilution of less than 3%, the substantial cash flow generation by BSRC, combined with the offer’s valuation at just 4.3 times enterprise value to free cash flow (EV/FCF), appears notably appealing.
Furthermore, Maybank anticipates that BCP might register a slight revaluation gain shortly after concluding the transaction, as was the case when it initially secured a majority stake in BSRC.
