A Thai state-owned gas retailer said on Thursday it has begun the process of acquiring a controlling 65.99% stake in Esso Thailand from ExxonMobil Asia Holdings -- a deal worth 55.5 billion baht ($1.6 billion) that will leave Bangchak with the country's largest gas station network.
Bangchak informed the Stock Exchange of Thailand (SET) on the same day that its board of directors unanimously approved the acquisition.
CEO Chaiwat Kovavisarach said the acquisition is expected to be completed in the second half of this year. Afterward, the company will launch a tender offer for the remaining ordinary shares, he said.
"This acquisition deal is another major step toward greater energy security that will help balance our long-term strategy with energy affordability and sustainability," Chaiwat said. "I believe this transformational transaction marks the beginning of a new chapter for Bangchak and for Thailand."
Analysts expect the deal to strengthen several of Bangchak's operations. Besides the added gas stations, the deal will give the company more oil refining capacity.
The acquisition includes a 174,000 barrel per day refinery complex, a network of distribution terminals and more than 700 service stations. The infrastructure is expected to catalyze further growth and help Bangchak improve its margins.
When the transaction is completed, Bangchak will have a refining capacity of 294,000 bpd; it will also have 2,100 gas stations, up from 1,030 as of December.
The largest oil retailer in Thailand
"That will make Bangchak the biggest oil retailer with the highest number of petrol stations, topping PTG Energy, which has 2,062 stations nationwide," a Kasikorn Research Center analyst said.
Share this:
