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UPDATE 1-Thai tycoon to spin off F&N's property unit, eyes REIT
August 27, 2013 / 11:24 AM / 4 years ago

UPDATE 1-Thai tycoon to spin off F&N's property unit, eyes REIT

(Adds detail on the restructuring plan, CFO, analyst quotes)

By Eveline Danubrata and Saeed Azhar

SINGAPORE, Aug 27 (Reuters) - Thai billionaire Charoen Sirivadhanabhakdi took the first step that would help combine Fraser and Neave with his own business empire, as he puts his stamp on the 130-year old company that he acquired for $11 billion earlier this year.

Fraser and Neave announced on Tuesday it will list shares in its property arm, Frasers Centrepoint Ltd, on the Singapore Exchange this year.

F&N will keep the food and beverage as well as the publishing and printing businesses.

Frasers Centrepoint, which has total assets of S$10.5 billion ($8.21 billion), will focus on residential and commercial property development in Singapore, China and Australia.

It may also acquire or asset manage some of Charoen’s hotels outside Thailand, and is exploring management services and property development within Thailand.

The company also said it is evaluating a hospitality real estate investment trust (REIT), which sources have told Reuters are part of the Thai tycoon’s plan to merge some of F&N’s assets and his hotels. Sources said earlier this week the REIT may raise at least $500 million.

Charoen owns F&N through his family vehicle TCC and Thai Beverage PCL.

“If and when the hospitality REIT happens, then we will look at what structure it will be and who owns what,” said F&N chief financial officer Hui Choon Kit at the sidelines of a media briefing.

The restructuring comes a few months after Charoen took control of the Singapore real estate and soft drinks conglomerate after a bidding war with a group led by Overseas Union Enterprise.

Goh Han Peng, analyst at DMG & Partners Securities, said the property, food and beverage businesses of F&N were disparate therefore the first step was to spin off property separately to derive value.

“There is quite a fair bit of synergy between F&B (food and beverage) and ThaiBev, they can cross-sell each other’s products across different markets.”

F&N’s CFO said the company has begun distributing ThaiBev’s Green tea brand Oishi in Malaysia and there are discussions to distribute F&N’s products, such as 100PLUS, in Thailand.

DBS, Morgan Stanley and United Overseas Bank were financial advisers for the restructuring.

$1 = 1.2797 Singapore dollars Editing by Louise Heavens

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