Thais extend Fraser and Neave offer deadline to Jan. 2

SINGAPORE Tue Dec 11, 2012 6:10am IST

Stacks of Fraser and Neave (F&N) products are on display at its factory in Pulau Indah outside Kuala Lumpur December 4, 2012. REUTERS/Bazuki Muhammad

Stacks of Fraser and Neave (F&N) products are on display at its factory in Pulau Indah outside Kuala Lumpur December 4, 2012.

Credit: Reuters/Bazuki Muhammad

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SINGAPORE (Reuters) - Thailand's third-richest man extended the deadline on his S$8.88-per-share offer to buy Fraser and Neave Ltd (FRNM.SI), to January 2, the fourth delay in about one-and-a-half months as he plays for time until the January 3 deadline of a slightly higher rival bid.

The waiting game between two of Southeast Asia's most powerful tycoons is expected to escalate into a bidding war for Singapore's F&N, a 129-year-old company with property assets worth more than S$8 billion ($6.55 billion) as well as soft drinks and printing businesses.

F&N's shares have steadily been trading well above the price of both Thai billionaire Charoen Sirivadhanabhakdi's offer and the competing S$9.08-per-share bid from a group led by Singapore property firm Overseas Union Enterprise Ltd (OVES.SI).

Overseas Union Chairman Stephen Riady is also the president of Indonesia's Lippo group of companies.

The Overseas Union group may be prepared to bid up to S$9.88 per share for F&N, assuming it sells F&N's non-property assets and keeps a minimum internal rate of return of 25 percent, Jit Soon Lim, an analyst at Nomura, said in a report last week.

Lim has a S$10.48 target price for the stock, compared with its latest close of S$9.45.

Charoen - through two companies linked to him, TCC Assets and Thai Beverage PCL (TBEV.SI) - made his S$8.88-per-share offer in September for the nearly 70 percent of F&N he did not already own, valuing the company at around S$12.8 billion ($10.5 billion).

The Overseas Union-led group came up with a S$13.1 billion counterbid and last week set a January 3 deadline for its offer.

F&N shares have surged more than 50 percent so far this year, outperforming the nearly 18 percent gain in the benchmark Straits Times Index .FTSTI.

The Thai group's stake, which has edged up to 33.6 percent, makes it F&N's biggest shareholder. It has also received acceptances from F&N shareholders representing a further 1.4 percent.

Kirin Holdings Co Ltd (2503.T), F&N's second-biggest shareholder with a stake of around 14.8 percent, has given its conditional support to the Overseas Union group. The Japanese brewer will offer to buy F&N's food and beverage business for S$2.7 billion if the group's bid is successful.

($1 = 1.2208 Singapore dollars)

($1 = 1.2216 Singapore dollars)

(Reporting by Eveline Danubrata; Editing by Edmund Klamann)