On Wednesday at 10:51 AM (Bangkok time), the share price of VGI Public Company Limited (SET: VGI) rose by 5.42% or THB 0.09 to THB 1.75 per share, with a trading value of THB 374.7 million.
Mr. Keeree Kanjanapas, Chairman of the Board of Directors of VGI, stated via “Kaohoon” that there were high chances that the company would sell all of Kerry Express (Thailand) Public Company Limited (SET: KEX) shares since it would be beneficial for the company in the long run, while the company was still in the process of consideration as the holding of the stock had continuously had negative effects on the company’s earnings.
VGI Public Company Limited (SET: VGI) holds 269,230,900 shares, or a proportion of 15.45%, of KEX, while BTS Group Holdings Public Company Limited (SET: BTS) holds 88,100,000 shares, or a proportion of 5.06%. If both companies choose to sell all of the stocks at the price of THB 5.50 per share in accordance with the tender offer from SFTH, they will receive cash flow in the amount of THB 1,480.77 million and THB 484.55 million, respectively.
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 steps 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 in the future.
Krungsri Securities stated in its note that there were concerns that VGI would take 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 operations in the 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.