Gulf Energy excludes Thaicom in $5.4 billion buyout deal for parent company InTouch

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TAMPA, Fla. — Gulf Energy Development, a Thailand-based power producer, offered April 19 to buy out the parent company of Thai satellite operator Thaicom for as much as 169 billion baht ($5.4 billion).

But Bangkok-based Gulf Energy said it will only pursue the deal for Intouch Holdings, which also owns Thailand’s largest wireless operator Advanced Info Service (AIS), if it can buy the group without having to acquire the rest of Thaicom.

The company is asking Thailand’s securities regulator to waive a requirement to make an offer for all of the satellite operator’s shares.

Controlled by billionaire Sarath Ratanavadi, Gulf Energy already owns 18.9% of Intouch, which has a 40.45% stake in AIS. InTouch owned 41.13% of Thaicom as of Feb. 19.

Singaporean telecoms giant Singtel, which is InTouch’s largest shareholder with about 21%, also owns 23% of AIS.

Singtel said in a stock exchange announcement that it is reviewing its strategic options for InTouch and AIS.

“Singtel views its stakes in INTUCH and ADVANC as strategic investments and we believe in the long term outlook of the businesses,” it said. 

Gulf Energy offered to buy the shares it does not already own in InTouch for 65 baht each, which is 11% higher than where they closed April 16.

If it secures at least 50% of InTouch with this tender offer, it proposed buying out AIS stockholders at 122.86 baht per share. Those shares closed on Thailand’s stock exchange April 19 at 169.5 baht.

Thaicom reported a 23.7% fall in revenues from sales and services to 3.6 billion baht for 2020, compared with 2019, which it said was mainly because it had to de-orbit its Thaicom 5 satellite.

Thaicom 5 de-orbited in February 2020 following technical issues in December 2019.

Launched in May 2006 and built by Europe’s Thales Alenia Space, Thaicom 5 had been providing TV broadcast services for 14 years.

Customers were migrated to Thaicom 6, positioned at the same 78.5 degrees East orbital slot as Thaicom 5, and other satellites.

Thaicom’s net profit for 2020 improved to 514 million baht, compared with a 2.25 billion baht loss in 2019, mainly due to the impairment of satellite assets.