Gulf shareholders approve merger with Intouch

Shareholders of Gulf Energy Development Plc on Thursday approved a planned merger with its telecoms affiliate Intouch Holdings Plc, paving the way for the 990-billion-baht transaction to get done.
Gulf shares on the Stock Exchange of Thailand were poised to rise the most in two weeks after almost all shareholders approved the merger, giving the company a market value of 660 billion baht.  
Intouch shares were headed for biggest gain in nearly a month, valuing the parent of mobile operator Advanced Info service at 330 billion baht.
A combination of the companies will accelerate business and earnings growth of the newly created entity, Gulf founder and CEO Sarath Ratanavadi said at a shareholders’ meeting in Bangkok.
“The almost unanimous vote of Gulf Energy shareholders offered a much more positive outlook,” he told reporters. “I am willing to buy out all shares of dissenting shareholders who vote against it.”
Only a few minutes before the vote result, Mr Sarath had said he still didn’t rule out withdrawing a proposed purchase of shares from dissenting shareholders of Gulf and Intouch if they voted overwhelmingly against the deal.
The billionaire had been leaning against buying out minority investors who may oppose the tie-up, Bloomberg reported earlier. Such a move could have represented a major hurdle for the deal, people familiar with the matter had said.
The surge in the share prices of both the companies since the deal was announced in July was seen as making it more challenging — and expensive — for the merger to get done.
Mr Sarath, who along with his family control a roughly 74% stake in Gulf Energy, needs to buy out minority investors to be able to complete the deal. Under Thai law, more than three-quarters of shareholders in the meeting need to approve the deal and the biggest shareholder needs to purchase the shares from dissenting investors. 
Mr Sarath is Thailand’s richest person with a net worth of $15.3 billion, according to the Bloomberg Billionaires Index.
Gulf Energy said in July that it planned to combine with its telecom unit Intouch to simplify the group’s shareholding structure and maximise benefits for future operations and investments. A key condition is that Mr Sarath buys out minority shareholders who vote against the merger at the market prices as of Wednesday.
As part of the agreement, the billionaire has a right to withdraw from acquiring shares of Gulf from dissenting investors if the share price on Oct 2 is higher than 45 baht. The shares closed at 56.50 baht on Wednesday, 26% above the stated ceiling.
For Intouch, he has an option to cancel the offering if the company’s stock price is above 76 baht. The stock closed at 91 baht on Wednesday.