BTS and VGI May Consider Offloading ‘KEX’ Shares to SF International Holding

The reporter reported that regarding the case of the tender offer from SF International Holding (Thailand) or SFTH, managed by Kerry Logistics Network Limited (KLN), after the completion of a special interim dividend of Kerry Express (Thailand) Public Company Limited (SET: KEX) apart from the 52.06% proportion that SFTH held, there will be another offer for the remaining proportion at the price of THB 5.50 per share.

The tender offer from SFTH to KEX may signal the major shareholders, including VGI Public Company Limited (SET: VGI), holding 269,230,900 shares or a proportion of 15.45%, and BTS Group Holdings Public Company Limited (SET: BTS), holding 88,100,000 shares or a proportion of 5.06%, to consider if they want to accept the offer or not. This is to cut the problematic investment sharing in KEX.


Krungsri Securities stated in its note that there were concerns that VGI would took a net loss of THB 2,700-2,900 million in the 3Q23-1Q24 financial statement by setting aside the impairment of investment in KEX and taking losses from business operation in an amount of THB 170-180 million. This may cause the 2023/2024 financial statement of VGI to record a net loss of more than THB 1,000 million.


Meanwhile, many analysts expected the said set-aside impairment of investment in KEX to send positive sentiment to VGI in the long run, as it is a one-time non-cash impairment. If VGI stepped out of this investment by accepting the said tender offer, the company will receive cash flow without any recognition of any loss from a highly competitive logistics business, which caused the company to take losses, in the future.


CGS-CIMB Securities (Thailand), currently CGS International Securities (Thailand), once wrote in a note stating that BTS may need to set the impairment for the investment in KEX.

As a result, if VGI and BTS chose to sell all of the stocks in accordance with the tender offer from SFTH, both companies will receive cash flow in an amount of THB 1,480.77 million and THB 484.55 million, respectively.


UOB Kay Hian Securities also stated earlier that VGI may not accept the deal, as the company’s costs were around THB 18-20. The company could encounter a THB 3,000 million loss if it chose to sell all the shares. As well as BTS, the firm did not expect the company to accept the offer, as the costs for BTS were around THB 10.00 per share.