TOKYO: Japan’s Mitsubishi UFJ Financial Group plans to buy a 51 percent stake in Thailand’s Bank of Ayudhya for about 400bn yen ($4.1bn) in a bid to expand its business in Southeast Asia, a report said yesterday.
By turning Thailand’s fifth-largest commercial bank into a subsidiary, MUFG aims to offer a wide range of financial services to consumers and businesses in Thailand, the business daily Nikkei said.
This will mark the first time that a Japanese bank takes direct control of a major bank in the rest of Asia.
To date, Japanese banks have focused their operations there largely on lending to Japanese companies and helping them with trade settlement, Nikkei said.
MUFG will first buy out GE Capital’s entire 25 percent stake in the Thai bank, a person close to the discussions told Dow Jones.
It will then launch a tender off for the remaining shares, but seek to keep the other big shareholder, Thailand’s Ratanarak family which holds 22 percent, as a partner, the Down Jones report said.
The Japanese financial group could forge a formal agreement early next month.
Bank of Ayudhya has a market capitalisation of about $6.1bn. Under a typical buyout scenario in which a premium over the stock price is offered, MUFG stands to pay 400bn yen or so, making this the largest acquisition on record in Asia by a Japanese bank, the Nikkei said.
AFP
