S'pore bourse slaps F&N with an ultimatum

The new Thai owners of Fraser & Neave (F&N) have been given a nudge by the Singapore bourse operator to reveal their plans for the 130-year-old conglomerate.

The Singapore Exchange (SGX) has given F&N bosses until April 18 to announce whether they intend the firm to stay listed on the SGX – or go private, as most analysts expect.

F&N’s shares have been halted from trade since February 19.

The SGX also said that it would convert the trading halt of F&N’s shares into a trading suspension with effect from April 19, unless the company makes clear that it intends to keep its listing status.

“The company is considering its options with respect to its listing status and will make an appropriate announcement in due course,” added an announcement from F&N yesterday.

This new deadline could pin a timeframe for the possible de-listing of F&N, a beverage and property conglomerate.

Market players generally expect F&N’s new Thai owners to privatise the company – a move which would give them more leeway to restructure it.

Analysts note that F&N has not, even after more than one month of a trading halt, announced any plans to restore its public float which had dipped below the 10 per cent requirement.

Thai billionaire Charoen Sirivadhanabhakdi’s TCC Assets and Thai Beverage together hold more than 90 per cent of F&N after a successful takeover by TCC Assets that stretched back to last September. In the process, he managed to edge out bidding rival Overseas Union Enterprise, which threw its hat into the ring in November last year.

The last public statement regarding F&N’s listing status was back in September, in TCC Assets’ offer document.

“It is the current intention of [TCC Assets] to maintain the present listing status of the company on the mainboard of the SGX and [TCC Assets] does not intend to exercise its right of compulsory acquisition under the Companies Act,” stated the document.

But the document added that if F&N does not meet the minimum public float requirements at the close of the offer, TCC Assets “reserves the right to re-evaluate its position, including its right of compulsory acquisition if applicable”.

Analysts expect that Charoen will now want to privatise F&N, given the overwhelming success of his offer.

Jonathan Foster, global director of special situations at Religare Capital, said he does not expect Charoen to try to resume the trading of F&N shares.

In fact, he expects Charoen to try to sweep up the rest of the outstanding shares, using the powers of compulsory acquisition under the Companies Act if possible. “It is much easier to do restructuring if it’s privately held,” Foster said.

F&N is owned by a combination of TCC Assets and Thai Beverage. Singapore-listed drinks and alcohol company Thai Beverage could take on more of F&N’s drinks businesses while the property arm could go to the privately held TCC Assets, say market watchers.

Already, F&N is losing its place on the benchmark Straits Times Index (STI) amid the uncertainty over its future listing status. It will be replaced by Hutchison Port Holdings Trust as one of the 30 STI component stocks from the start of trading tomorrow.