RATCH Invests THB3.4 Billion to Acquire 51% Stake of SCG to Build Strong Alliances

RATCH Group Public Company Limited (RATCH) has announced that the company will make an investment by purchasing ordinary shares of Sahacogen (Chonburi) Public Company Limited (SCG) from certain existing shareholders of SCG and subscribing the newly issued ordinary shares of SCG which shall be issued and allotted to specific person (Private Placement). In this regard, on 28 October 2021, the company executed the following agreements:

 

1) 34 share purchase agreements between the company (as the purchaser) and 34 shareholders of SCG, including Saha Pathana Inter-Holding Public Company Limited (SPI), whereby the names of the such sellers are listed in the Enclosure (as the sellers). The share purchase agreements are for the purchase of ordinary shares in SCG from the aforementioned shareholders, in the total amount of 384,789,131 shares (equivalent to 40.29 percent of all issued shares of SCG prior to the increase of share capital as per (2) below or 33.07 percent of all issued and allotted shares of SCG after the issuance and allotment of ordinary shares under (2)) (Sale Shares), with the value of Baht 5.75 per share, equivalent to the total consideration of Baht 2,212,537,503.25 (collectively referred to as Share Purchase Agreements) (Share Purchase Transaction); and

 

2) share subscription agreement between the company (as an investor) and SCG for the subscription of newly issued ordinary shares in the amount of 208,695,652 shares with a par value of Baht 1.00 (equivalent to 17.93 percent of all issued and allotted shares by SCG after the issuance and allotment of newly issued ordinary shares by SCG by way of private placement) at the subscription price of Baht 5.75, equivalent to totaling Baht 1,199,999,999 (Share Subscription Agreement) (Share Subscription Transaction).

 

After the consummation of the Transactions, the company will acquire a total of 593,484,783 ordinary shares in SCG, equivalent to 51 percent of the shares issued and allotted by SCG following the issuance and allotment of newly issued ordinary shares by SCG to the company. As a result, SCG will become a subsidiary of the company.

 

This therefore triggers another obligation of the company to make tender offer for the remaining shares in SCG. Nonetheless, the company will only make one tender offer for all shares in SCG to comply with its obligation under Tender Offer Obligation No. 1 and Tender Offer Obligation No. 2 after SCG has registered the change in paid-up share capital with the Ministry of Commerce in relation to the Share Subscription Transaction. The company will make a tender offer for the remaining shares in SCG in the total amount of 570,210,869 shares (equivalent to 49 percent of the total issued shares in SCG after the newly issued ordinary shares have been issued and allotted by SCG) at the price of Baht 5.75 per share within the prescribed period.

 

RATCH stated that This investment is for the purpose of building strong business alliances between the company, which has expertise in the development of power plant projects, and Saha Group, which is considered as a large business group with main activities focusing on the manufacturing and distribution of consumer goods in Thailand and is the original founders of SCG that will continue to maintain its material shareholding proportion in SCG. The company and Saha Group will jointly develop SCG’s power plant to encourage its strength and sustainable growth in its full capacity, including promoting the increase of capacity and competence in other projects of Saha Group in the future. This investment aligns with the goal to increase the company’s total generation capacity of 10,000 MW and total business value of Baht 200,000 million by 2025. This investment is also in line with the sustainable growth strategies in power plant, infrastructure and other related businesses whereby the company will use its loan or working capital as the source of funds for this investment.