Just announced this evening, BMCL and BECL will be merging.
The basic deal structure is as follows:
- 1 existing share in the Company to 0.42050530 shares in MergedCo
- 1 existing share in BECL to 8.65537841 shares in MergedCo
- The deal is expected to be completed by 3Q15
My quick thoughts:
- Great move by CK, BECL has a clean balance sheet, minimal debt, good cashflows, BMCL which just recently raised capital may potentially need more for the upcoming route expansions, thus instead of CK injecting more funds into BMCL, it can utilise the balance sheet of BECL
- The MergedCo should in theory be more valuable, part of the SET50, attract more investors, and potentially a higher overall valuation than two separate entities
- Funny how the news was announced @ 9.30PM but BMCL’s stock price was up 6% today, BECL up as much as 2% and CK up 4%, insider trading perhaps? Yoohoo SEC wake up!
See below for the link to the full release