Bangchak Acquires Esso Thailand, Restructuring Thai Energy Market
Bangkok—Bangchak Corporation Plc (BCP), a prominent Thai energy conglomerate, announced plans to acquire the remaining 18.3% minority stake in its subsidiary, Bangchak Sriracha Plc (BSRC), formerly Esso Thailand. This completes BCP’s takeover of the former Esso operations, further strengthening its position in the Thai energy sector.
The acquisition, a share swap, will offer BSRC minority shareholders newly issued BCP ordinary shares at a ratio of one BCP share for every 6.50 BSRC shares. According to Chaiwat Kovavisarach, Chief Executive of Bangchak Group and President of BCP, this allows minority shareholders to exchange their holdings in BSRC for a stake in the larger, financially stronger parent company.
This consolidation strategy offers several key benefits. Mr. Kovavisarach emphasized the enhanced operational flexibility and efficiency of a simplified shareholding structure, enabling quicker responses to market opportunities and improved financial performance. Eliminating redundant processes associated with managing a subsidiary listed on the Stock Exchange of Thailand (SET) will create a more agile and cost-effective operational model. The proposed delisting of BSRC from the SET will further enhance efficiency.
Beyond operational streamlining, the move benefits BSRC’s minority shareholders. Mr. Kovavisarach highlighted the opportunity to participate in BCP’s growth, citing the company’s substantial earnings before interest, tax, depreciation, and amortization (EBITDA) of approximately 40 billion baht. While relinquishing direct ownership in BSRC, these shareholders will retain indirect ownership through their BCP holdings, gaining access to a more liquid stock and larger market capitalization, thus benefiting from the parent company’s growth and stability.
This strategy aligns with Bangchak Group’s ambitious «Bangchak 100X» strategy, aiming for 100 billion baht EBITDA by 2030. This plan demonstrates the company’s commitment to long-term growth and confidence in the Thai energy market. Consolidating BSRC positions Bangchak to capitalize on emerging opportunities and solidifies its standing as a major regional player.
Shareholder approval is required. BSRC and BCP will hold their respective annual general meetings on April 9th and 11th, where shareholders will vote on the proposed share swap and delisting. If approved, the restructuring should be finalized later this year, a significant milestone in Bangchak’s growth strategy and its consolidation of former Esso Thailand assets. The meeting outcomes will be closely watched by market analysts and investors, providing valuable insight into the future direction of this key Thai energy player.
