Berli Jucker Public Company Limited (SET: BJC) announced that its Board of Directors’ Meeting approved the plan for the Initial Public Offering (IPO) of Big C Retail Corporation Public Company Limited (BRC), a subsidiary of the company, and the listing of the shares of BRC on the Stock Exchange of Thailand (the SET).
BRC is a flagship company of the company which engages in retail, wholesale, procurement of manufacturing, import and export of consumer goods, both domestically and internationally, as well as the development and leasing of real estate related to and supports its own retail and/or wholesale businesses. The proportion of the number of the newly issued ordinary shares of BRC to be offered in the IPO (the IPO Shares) shall not exceed 29.98 percent of the total paid-up capital of BRC after the capital increase and the issuance and offering of the IPO Shares, which include the number of shares to be allocated to the over-allotment agent (if any).
After the offering of IPO Shares, the company will remain a major shareholder and the controlling person of BRC, and BRC will retain its status as the company’s subsidiary.
However, the implementation of the Plan for Listing on the SET will result in a dilution of the company’s shareholding in BRC from 100.00 percent of total paid-up capital (before this issuance and offering of shares of BRC) to not less than 70.02 percent of total paid-up capital of BRC after the capital increase and the issuance and offering of the IPO Shares, which include the number of shares to be allocated to the over-allotment agent.
The benefits for taking BRC to public are as follows;
1) Part of the proceeds that BRC will receive from the capital increase and the issuance and offering of the IPO shares will be used to repay the existing debt that BRC group borrowed from the company. The company may use such proceeds received from the debt repayment to repay some of the company’s debt which will help strengthen the overall financial position of the company’s group.
2) Listing of BRC on the SET will lessen the company’s burden in providing financial support to BRC and will increase BRC’s flexibility in accessing various sources of funding from both equity market and debt capital market, and increase BRC’s fundraising channels by means of independent fundraising, which will increase its competitiveness and the ability to expand its business.
3) Upon BRC’s shares becoming listed securities, BRC’s shares will have higher liquidity and reference market price, which investors will be able to use as a reference for trading such securities or as a consideration to make a payment for the asset or business acquisition in the future.
4) Enhance BRC’s reputation and image to be more well-known, including giving rise to the opportunity to seek for personnel and/or business partners with knowledge and experience in retail and wholesale businesses.
BRC has plans to use the proceeds from the IPO to invest in business expansion both domestically and internationally, to use for financial restructuring and to use as its working capital, including partially repaying some of its debt and other purposes. In this regard, BRC will specify the details of the use of proceeds in the registration statement for securities offering and the draft prospectus of BRC.