SAHA PATHANA INTER-HOLDING PLC.

Transcription

1 Attachment No. 5 Information Memorandum Regarding the Acquisition of Assets and Connected Transaction in respect of the acceptance of transfer of the entire business transfer of President Holding Co., Ltd. and the tender offer for all securities in President Rice Products Public Company Limited and President Bakery Public Company Limited (Pursuant to List 2) SAHA PATHANA INTER-HOLDING PLC.

2 Saha Pathana Inter-Holding Public Company Limited Information Memorandum Regarding the Acquisition of Assets and Connected Transaction in respect of the acceptance of transfer of the entire business transfer of President Holding Co., Ltd. and the tender offer for all securities in President Rice Products Public Company Limited and President Bakery Public Company Limited (Pursuant to List 2) 1 Information Memorandum Pursuant to List Transaction Date The Board of Directors meeting of Saha Pathana Inter-Holding Public Company Limited ( Company or SPI ) No 11 (Board #23) held on 15 March 2017 has resolved to agree with the entire business transfer of President Holding Co., Ltd. ( PH ) including the tender offer for all securities in President Rice Products Public Company Limited ( PR ) and President Bakery Public Company Limited ( PB ) and propose to the meeting of shareholders of the Company to consider and approve that the Company accept the entire business transfer of PH which undertakes the business of long-term lease of vehicles and machinery and investment business by holding shares in other companies (including shares held by PH in companies undertaking food businesses namely Thai President Foods Public Company Limited ( TF ), PR and PB) by the method of the Entire Business Transfer ( EBT ). The Company has entered into the business transfer agreement dated 15 March 2017 with PH (the BTA ). Under the BTA, PH is to transfer and the Company is to accept the transfer of the EBT, which is to be completed within the same day according to the details set out in the BTA (which is expected to occur by June 2017). Upon completion of the EBT, the Company will be required to make a tender offer for all ordinary shares in PR at the price of Baht per share and PB at the price of Baht per share in compliance with the duties after the acquisition of the ordinary shares of PR and PB by way of the EBT resulting in the shareholding in PR and PB exceeding the trigger point for making a mandatory tender offer as prescribed under the Notification of Capital Market Supervisory Board No TorJor. 12/2554 Re: Rules, Conditions and Procedures for the Acquisition of Securities for Business Takeovers dated 13 May 2011, as `amended ( Notification TorJor. 12/2554 ). The acquisition of ordinary shares in PR and PB by SPI which results in the shareholding in PR and PB exceeding the trigger point for making a mandatory tender offer for all securities in PR and PB will occur upon (1) the annual general meeting of shareholders of the Company No 46 has resolved to approve that the Company accept the EBT from PH as well as the making of a mandatory tender offer for all securities in PR and PB; and (2) the EBT from PH to the Company has been completed and the Company has made payment for the EBT to PH in whole on the same day, pursuant to the terms and conditions under the BTA, which is expected to occur by June As such, upon the acquisition of ordinary shares in PR and PB by the Company which results in its shareholding in PR and PB exceeding the trigger point for making a mandatory tender offer for all securities in those entities, the Company shall, from such date, be obliged to make a tender offer of all securities in PR at the price of Baht per share and PB at the price of Baht per share in accordance with Notification TorJor. 12/2554, with a tender offer period of not less than 25 business days but not more than 45 business days consecutively in accordance with details in the tender offer. In respect of the Co-Tender Offer for all securities in PB abovementioned, TF has informed the Company in the letter dated 15 March 2017 of its intention to participate in the making 1

3 of a tender offer for all shares in PB (Co-Tender Offer) under which TF has expressed its intention to acquire one-half of the number of the ordinary shares in PB tendered in the Co- Tender Offer for all shares in PB jointly with the Company. In order for TF to proceed as described, the meeting of shareholders of TF must resolve to approve the acquisition in part of the ordinary shares in PB by making the Co-Tender Offer for all securities in PB jointly with the Company (for more details in relation to the entry into the acquisition of part of ordinary shares in PB by way of making a tender offer for all securities in PB jointly with the Company, please see TF s Information Memorandum regarding the entry into the acquisition of part of ordinary shares in PB by way of making a tender offer for all securities in PB jointly with the Company being disclosed to the Stock Exchange of Thailand). The EBT and the tender offer for all securities in PR and PB as a result of the EBT is considered to be the purchase or acceptance of transfer of the business of other companies or private companies by the Company pursuant to Section 107(2)(b) of the Public Limited Company Act B.E. 2535, as amended (the PLCA ). The transaction is also considered Class 1 Transaction pursuant to the rules under the Notification of Capital Market Supervisory Board No. TorJor. 20/2551 Re: Rules on Entering into Material Transactions Deemed as Acquisition or Disposal of Assets dated 31 August 2008, as amended and the Notification of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Acquisition and Disposition of Assets B.E dated 29 October 2004, as amended (the Acquisition and Disposal Notifications ). The EBT is also a connected transaction under the type of transaction relating to assets or service of which the transaction value exceeds than 3.00 per cent of the value of net tangible assets of the Company pursuant to the Notification of the Capital Market Supervisory Board No. TorJor 21/2551 Re: Rules on Connected transactions dated 31 August 2008, as amended, and the Notification of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Connected transaction B.E dated 19 November 2003, as amended (the Connected Transaction Notifications ). Therefore, the Company is required to disclose the information regarding the transaction to the Stock Exchange of Thailand ( SET ), appoint an independent financial adviser to render opinion to shareholders on the transaction and convene a meeting of shareholders to resolve to approve the execution of the transaction by the votes of no less than three-fourths of total voting rights of shareholders attending the meeting with voting rights, excluding votes of interested shareholders Overview of the proposed transaction SPI s main business is a holding company. Its revenue primarily consists of dividend payments from its equity interest in its subsidiary and associated companies. The Company currently invests in three major lines of businesses which are production, distribution, services and other businesses. SPI intends to increase its investment in food businesses, which is currently in a lesser proportion comparing to the investment in other businesses of the Company, by the EBT from PH which undertakes the investment business by holding shares in other companies in Saha Group which operate food business in a high proportion (including shares held by PH in TF, PR and PB. Other than holding shares in such companies, PH also holds shares in other 4 companies with insignificant value, namely S. Pack & Print Public Company Limited, President Interfood Co., Ltd., Thai Sun Foods Co., Ltd. and Sriracha Transport Co., Ltd. The EBT will mitigate its investment risk exposure by diversification into food businesses whose fluctuation of 2

4 risk is lower as compared to its current investments in other businesses such as industrial park, cosmetic and textile industry. Currently, the Company is a listed company on the SET with the highest equity interest holding in food-sector businesses of Saha Group (namely TF, PR and PB). The EBT will strengthen its shareholding structure in food-sector businesses of Saha Group. As of 15 March 2017, the shareholding of the related companies is as follows: The Company holds 39,520,820 ordinary shares (equivalent to per cent) in TF, 4,500,000 ordinary shares (equivalent to 3.01 per cent) in PR and 12,669,600 ordinary shares (equivalent to 2.82 per cent) in PB; TF holds 1,806,250 ordinary shares (equivalent to 1.21 per cent) in PR and 42,237,500 ordinary shares (equivalent to 9.39 per cent) in PB; PR holds 168,817,500 ordinary shares (equivalent to per cent) in PB; PH holds 156,000 ordinary shares (equivalent to 0.09 per cent) in TF, 49,037,000 ordinary shares (equivalent to per cent) in PR and 84,450,000 ordinary shares (equivalent to per cent) in PB. The chart below is the shareholding structure of the Company in TF, PR and PB before the EBT based on information as of 15 March After the completion of EBT, there will be the amalgamation between TF and PR resulting in a new company being formed (the New Co ) (which is expected to occur by October 2017) which will be the flagship company of Saha Group s food-sector businesses which include the whole range of instant food products under the brand MAMA and other businesses including biscuits, fruit juices, breads, bakery products and packaging etc. The amalgamation will be beneficial to the Company and shareholders in a long term in many aspects and will strengthen the business advantages and create synergistic effects to benefit the future business growth potential. In this regards, the Company will support the amalgamation of TF and PR by agreeing to be a balancer in the rounding off of share fractions and to pay to or receive compensation from the New Co for such shares balancing, in order to 3

5 achieve the specified number of shares of the New Co. (for more details in relation to the amalgamation, please see the Information Memorandum regarding the amalgamation of TF and PR being disclosed to the Stock Exchange of Thailand). The chart below is the shareholding structure of the Company in the New Co and PB before and after the amalgamation between TF and PR based on information as of 15 March Remark: (1) the shareholding may increase from the tender offer. The maximum percentage of shareholding is calculated on assumptions that 1) all other shareholders have accepted the tender offer for all securities in PR and PB, 2) TF jointly participates in the tender offer of half of the total shares in PB other shareholders accept to sell, and 3) PR will not sell ordinary shares in PB held by PR totaling 168,817,500 shares during the tender offer for all securities in PB according to the letter dated 15 March 2017 received by the Company and TF from PR that it does not intend to sell such securities. Upon completion of the amalgamation, New Co shall assume all assets, liabilities, rights, duties, and responsibilities of TF and PR by operation of law, including shares in PB amounting to not less than but not exceeding per cent of total shares with voting rights in PB which are originally held by TF and PR prior to the registration of the amalgamation, which will exceed the trigger point for making a tender offer for all securities in a business in accordance with Notification TorJor. 12/2554. However, this is the case where the Business Takeover Panel, the Office of Securities and Exchange Commission has granted a waiver for the New Co to make a tender offer for all securities in PB. As such, upon completion of the amalgamation, the New Co is not required to make a tender offer for all securities in PB again. Based on the foregoing, if shareholders in PB wish to sell their shares in PB after obtaining information regarding the expected change in overall shareholding structure of all related companies as well as any impacts on the shareholding structure of PB, the shareholders may sell their shares in PB upon the making of tender offer for all securities in PB by the Company jointly with TF as a result of the EBT between PH and the Company as mentioned above, even though the New Co is not required to make a tender offer for all securities in PB again since the waiver has been granted. Moreover, shareholders in PB will not be disadvantaged by their shares selling price since the price at which the Company will tender for all securities in PB jointly with TF will be in the range of the fair value price which the Company has acquired shares in PB under the EBT of PH which is the highest price at which the Company has acquired the ordinary shares in PR and PB during the 90-day period prior to the submission of the tender offer by the Company to the Office of Securities and Exchange Commission pursuant to the rules under the Notification TorJor. 12/

6 In the case where shareholders of PB do not sell their shares to the Company and TF in the tender offer for all ordinary shares in PB by the Company and TF as abovementioned, shareholders of PB may sell their shares on the SET or continuously hold shares in PB. After TF and PR having amalgamated and forming the New Co, the New Co will become shareholder of PB of not less than per cent but not exceeding per cent of the total shares with voting rights of PB. For the Amalgamation between TF and PR, in the case where the shareholders meetings of TF and PR resolve to approve the amalgamation, but there are some shareholders of TF and PR voting against the amalgamation in the shareholders meetings and no longer intending to hold shares in TF and PR ( Objecting Shareholders ), TF and PR shall arrange for a buyer to purchase shares of TF and PR from such Objecting Shareholders at the last traded price on the SET immediately prior to the date on which the shareholders meeting of TF and PR resolves to approve the amalgamation, i.e. 24 April 2017, pursuant to Section 146 of the PLCA. Such purchase of shares will be undertaken from 26 April 2017 until 9 May It is important to note that the process of purchase and sale of the shares, including the delivery and payment process, may be made by way of over-the-counter or other means as the buyer of shares from the Objecting Shareholders deems it appropriate subject to the relevant laws. The said delivery process will occur before or within the record date for the right to receive dividends of TF and PR (11 May 2017) and the payment will be made in accordance with the payment process. Therefore, the buyer of shares from the Objecting Shareholders will be entitled to receiving such dividends with respect to the shares purchased, and the Objecting Shareholders of TF and PR who exercise their right to sell those shares to the buyer will not be entitled to receiving such dividends that TF and PR will approve in the annual general meeting for year 2017 although the sale of shares by the Objecting Shareholders of TF and PR will be made on the dates the SET has posted XD in relation to such shares. In addition, the Objecting Shareholders may be subject to capital gain tax resulting from the sale of such shares in case the sale and purchase of shares must take place by way of over-the-counter according to the applicable regulations. In any event, TF and PR reserve the right to notify the shareholders at the earliest time, but no later than the date of the annual general meeting, if there is any change in method and process of purchase and sale of such shares. However, in case where the Objecting Shareholders of TF and PR do not sell their shares to the buyer pursuant to the amalgamation process under Section 146 of the PCLA as abovementioned, or do not sell their shares on the SET prior to the registration of the amalgamation, TF and PR will continue to proceed with the amalgamation and such Objecting Shareholders of TF and PR shall become the shareholders of the New Co upon completion of registration of the amalgamation. For shares in PR, in the case where Objecting Shareholders of PR would not like to sell shares to the purchaser arranged by PR pursuant to the amalgamation process under the PLCA, such shareholders have an opportunity to sell shares held by them during the tender offer of all securities in PR where the Company is required to undertake after the completion of the EBT of PH, which is expected to occur by June 2017 as prescribed above. The price offered to purchase shares from the Objecting Shareholders of PR may be different from the price the Company offered in the 5

7 tender offer of all securities in PR, which is at the price of Baht per share which is the highest price the Company has acquired ordinary shares in PR during the 90- day period prior to the submission of the tender offer by the Company to the Office of the Securities and Exchange Commission pursuant to the rules under the Notification TorJor. 12/2554. However, in the case where the Objecting Shareholders of PR do not sell their shares to the buyer pursuant to the amalgamation process under Section 146 of the PLCA or do not sell their shares to the Company in the tender offer for all ordinary shares in PR by the Company as above mentioned, or do not sell their shares on the SET prior to the registration of the amalgamation between TF and PR, TF and PR will continue to proceed with the amalgamation and such Objecting Shareholders of PR shall become shareholders of the New Co upon completion of the registration of the amalgamation. In this regard, Mr Pipat Paniangvait expresses an intention to be the buyer to purchase shares from Objecting Shareholders at the last traded price on the day prior to the date on which the shareholders' meeting approves the amalgamation, i.e. 24 April 2017, with terms and conditions on the purchase of shares from the Objecting Shareholders of TF and PR by Mr Pipat Paniangvait which has been disclosed to the SET by TF and PR on 16 March 2017 which includes the reservation of the right to withdraw from acting as such buyer if the last traded price on the day prior to the date on which the shareholders' meeting approves the amalgamation, i.e. 24 April 2017, exceeds Baht 205 per share and Baht 61 per share, for shares in TF and PR, respectively. In the event that Mr Pipat Paniangvait exercises his right to withdraw from acting as such buyer, TF and PR will use its effort to procure such a buyer to purchase shares from Objecting Shareholders. If TF and PR is unable to procure such a buyer in place of Mr Pipat Paniangvait by the date of the annual general meeting of TF and PR, TF and PR reserve the right to notify the shareholders at the earliest time, but no later than the date of the annual general meeting, if TF and PR is required to extend the time to procure a buyer to purchase shares from Objecting Shareholders and the time of the purchase or to postpone the consideration of the agenda items related to the Amalgamation as TF and PR deem appropriate. At present, Mr Pipat Paniangvait is the Vice Chairman of the Board and Chief Executive Officer of TF and has been working for TF for a very long period of time, and is a major shareholder of PR. Therefore, Mr Pipat Paniangvait is an appropriate person to buy shares from Objecting Shareholders of TF and PR. At present, Mr Pipat Paniangvait and his related persons hold shares in TF, PR and the Company in aggregate of 5.47 per cent, per cent and per cent, respectively. Moreover, Mr Pipat Paniangvait is the director of the Company. After the completion of the Amalgamation, Mr Pipat Paniangvait and his related persons will hold shares of not less than 7.64 per cent but not more than per cent of the total shares with voting rights of the New Co, subject to the number of shares in TF and PR which will be acquired by Mr Pipat Paniangvait from the shareholders of TF and PR voting against the Amalgamation. In the case that the purchase of shares from such shareholders of TF and PR results in Mr Pipat Paniangvait acquiring additional shares in TF and PR reaching or exceeding the trigger point for making a mandatory tender offer for all securities in a business at 25 per cent of the total voting rights in TF and PR in accordance with 6

8 1.1.2 EBT Notification TorJor. 12/2554, Mr Pipat Paniangvait is required to make a mandatory tender offer of all securities in TF and PR. However, this is the case where the Business Takeover Panel, Office of Securities and Exchange Commission has granted a waiver for Mr Pipat Paniangvait to make a tender offer for all securities in TF and PR. As such, in such event, Mr Pipat Paniangvait will not make a tender offer of all securities in TF and PR. For the benefit and success of the proposed transaction abovementioned, prevention of any confusion amongst shareholders or investors in general, and ensuring that the shareholders of related companies or investors in general have obtained sufficient, equal and up-to-date information, the Company, TF and PR are scheduled to propose a number related transactions as contemplated under the proposed transaction to a board of directors meeting of each relevant company on the same date which is 15 March 2017 for resolving to propose the matters to their shareholders at the annual general meeting of each company which will be held on 25 April The entire business transfer of PH consists of the following transactions: (a) (b) Transfer of shares held by PH in companies within Saha Group engaging in food-sector businesses, i.e. TF, PR and PB; Transfer of the following shares held by PH in other companies: (1) 2,937,540 ordinary shares in S. Pack & Print Public Company Limited, equivalent to 0.98 per cent of total issued shares of the company; (2) 153,000 ordinary shares in President Interfood Co., Ltd., equivalent to per cent of total issued shares of the company; (3) 300,000 ordinary shares in Thai Sun Foods Co., Ltd., equivalent to 6.00 per cent of total issued shares of the company; (4) 20,000 ordinary shares in Sriracha Transport Co., Ltd., equivalent to per cent of total issued shares of the company; (c) Transfer of all assets, liabilities and rights in relation to the business of longterm lease of vehicles and machinery and other assets relating to all existing businesses of PH as at the date of the EBT (as at 15 March 2017, comprising of 47 customers in the total amount of Baht 298,579, of 298 financial lease agreements of which 284 agreements are vehicle lease in the amount of Baht 283,440, and 14 agreements are machinery lease in the amount of 15,139,060.00). The total consideration under the EBT can be summarised below. Number of shares Percentage (%) Price per shares (Baht) Total consideration (Baht) Ordinary shares in TF 156, ,945,800 Ordinary shares in PR 49,037, ,606,316,550 7

9 Number of shares Percentage (%) Price per shares (Baht) Total consideration (Baht) Ordinary shares in PB 84,450, ,947,081,000 Ordinary shares in other companies including assets, rights and liabilities relating to long-term lease of vehicles and machinery and other assets relating to businesses of PH 337,656,650 Total consideration 7,920,000,000 Remark: Value of ordinary shares in TF, PR and PB is determined by taking into account the effect from the declaration of dividend distribution to be made by TF, PR and PB which must be approved by the 2017 Annual General Meeting of shareholders of such companies. Please consider criteria applied for determination of the total value of the transaction in paragraph 1.7 of this Information Memorandum The chart below is the shareholding structure of the Company in TF, PR and PB after the EBT based on information as of 15 March SPI % (1) 22.04% % (1) TF PB % (1) 1.21% 37.52% PR Remark: (1) the shareholding may increase from the tender offer. The maximum percentage of shareholding is calculated on assumptions that 1) all other shareholders have accepted the tender offer for all securities in PR and PB, 2) TF jointly participates in the tender offer of half of the total shares in PB other shareholders accept to sell, and 3) PR will not sell ordinary shares in PB held by PR totaling 168,817,500 shares during the tender offer for all securities in PB according to the letter dated 15 March 2017 received by the Company and TF from PR that it does not intend to sell such securities. Impacts on the Company after the EBT from PH in respect of shares in TF, PR and PB At present, the Company holds shares in TF, PR and PB equivalent to per cent, 3.01 per cent and 2.82 per cent, respectively. According to the accounting policies of the Company, the Company has recorded its investment capital in companies where the Company holds shares less than per cent, including investment capital in PR and PB as investment capital in securities available for sale by applying the price at cost, and has recorded its investment capital in companies where the Company holds shares from per cent but not more than 50 per cent, including investment capital in TF, as investment capital in affiliated companies by applying the equity method. After the EBT from PH, the Company will acquire shares in TF, PR and PB, resulting in shareholding in TF, PR and PB post EBT being per cent, per cent and per cent, respectively (shareholding in PR and PB may increase to 100 per cent and per cent on assumptions that 1) all other shareholders have accepted the tender offer for all securities in PR and PB, 2) TF jointly participates in the tender offer of half of the total shares in PB other 8

10 shareholders accept to sell, and 3) PR will not sell ordinary shares in PB held by PR totaling 168,817,500 shares during the tender offer for all securities in PB according to the letter dated 15 March 2017 received by the Company and TF from PR that it does not intend to sell such securities (moreover, according to the transaction plan, TF and PR will be amalgamated and form a new company, resulting in, ultimately, the Company holding shares in the new company of per cent in the case where there is no acceptance to the tender offer for all securities in PR, which may increase to per cent in the case where all other shareholders have accepted the tender offer for all securities in PR)). The increase of shareholding in the new company and PB will cause the company to conduct accounting record in respect of investment capital in the new company and PB as investment capital in affiliated companies by applying the equity method, and to realise profit sharing from such investment capital in the new company and PB (currently realising investment capital in PR and PB as dividends). This is expected to increase the total revenue and net profit of the Company and will better reflect value of investment capital due to the adjustment of investment capital value based on the actual operating results The mandatory tender offer for all securities in PR and PB as a result of the EBT Upon completion of the EBT under the BTA, the Company s shareholding in TF, PR and PB will be as indicated below, and the Company will be required to make a tender offer for all ordinary shares in PR and PB in compliance with the duties after the acquisition of the ordinary shares of PR and PB by way of the EBT resulting in the shareholding in PR and PB exceeding the trigger point for making a mandatory tender offer as prescribed under the Notification TorJor. 12/2554 as follows: (1) The Company s direct shareholding in TF will increase from per cent to per cent of total voting rights of TF; (2) The Company s direct shareholding in PR will increase from 3.01 per cent to per cent of total voting rights of PR which is the acquisition of shares exceeding the trigger point for making a mandatory tender offer as prescribed under the Notification TorJor. 12/2554. The Company is required to make a mandatory tender offer for all ordinary shares in PR at the price of Baht per share, being, 96,167,014 ordinary shares in PR with a par value of Baht 1 per share, equivalent to per cent of total issued shares in PR with the total consideration of not exceeding Baht 5,111,276,794 (which is the total number of issued shares in PR excluding shares in PR held by the Company and shares in PR which the Company will receive under the EBT); (3) The Company s shareholding in PB will increase from 2.82 per cent to per cent directly, and to per cent indirectly by which PR, as a related person of the Company under Section 258 of the Securities and Exchange Act B.E (as amended) holds on the completion date of the EBT; resulting in the Company's direct and indirect shareholding in PB exceeding the trigger point for making a mandatory tender offer as prescribed under the Notification TorJor. 12/2554. The Company is required to make a mandatory tender offer for all ordinary shares in PB at the price of Baht per share, being, 310,642,900 ordinary shares in PB with a par value of Baht 1 per 9

11 share, equivalent to per cent of total issued shares in PB with the total consideration of not exceeding Baht 18,197,461,082 (which is the total number of issued shares in PB excluding shares in PB held by the Company and TF and shares in PB which the Company will receive under the EBT, as TF will participate in the making of a tender offer for all shares in PB jointly with the Company as described below.) The acquisition of ordinary shares in PR and PB by the Company which results in the shareholding in PR and PB exceeding the trigger point for making a mandatory tender offer for all securities in PR and PB will occur upon (1) the annual general meeting of shareholders of SPI No 46 has resolved to approve that the Company accept the EBT from PH as well as the making of a mandatory tender offer for all securities in PR and PB; and (2) the EBT from PH to the Company has been completed and the Company has made payment for the EBT to PH in whole on the same day, pursuant to the terms and conditions under the BTA, which is expected to occur by June As such, upon the acquisition of ordinary shares in PR and PB by the Company which results in its shareholding in PR and PB exceeding the trigger point for making a mandatory tender offer for all securities in those entities, the Company shall, from such date, be obliged to make a tender offer of all securities in PR at the price of Baht per share and PB at the price of Baht per share in accordance with Notification TorJor. 12/2554. In respect of the Co-Tender Offer for all securities in PB abovementioned, TF has informed the Company in the letter dated 15 March 2017 of its intention to participate in the making of a tender offer for all shares in PB (Co-Tender Offer) under which TF has expressed its intention to acquire one-half of the number of the ordinary shares in PB tendered in the Co- Tender Offer for all shares in PB jointly with the Company. TF s intention to make the Co-Tender Offer for all shares in PB is to ensure that the New Co has increased its shareholding in PB upon completion of the amalgamation and becomes the Group s flagship company in food-sector businesses as being contemplated. In order for TF to proceed as described, the meeting of shareholders of TF must resolve to approve the acquisition in part of the ordinary shares in PB by making the Co-Tender Offer for all securities in PB jointly with the Company. In this regard, the Company and TF do not have or intended to have a relationship or act together in any manner which may be considered as the acting in concert by virtue of the Notification of the Capital Market Supervisory Board No. TorJor. 7/2552 Re: Acting in concert as a result of the nature of a relationship or behaviour and requirements under Sections 246 and 247 dated 20 February 2009, as amended (the Notification TorJor. 7/2552 ). The price at which the Company will tender for all securities in PR at the price of Baht per share and PB at the price of Baht per share will be equal to the price which the Company has acquired PR and PB shares under the EBT which is the highest price at which the Company has acquired the ordinary shares in PB during the 90-day period prior to the submission of the tender offer by the Company to the Office of the Securities and Exchange Commission pursuant to the rules under the Notification TorJor. 12/2554. Such tender offer price has derived from negotiations between the Company and PH which is in the range of the fair value price by taking into account the effect from the declaration of dividend distribution to be made by PR and PB which is to be approved by the 2017 annual general meeting of shareholders of PR and PB. Therefore, the tender offer price for ordinary shares 10

12 in PR is at the price of Baht per share with the total transaction value of not exceeding Baht 5,111,276,794 and the tender offer price for ordinary shares in PB is at the price of Baht per share with the total transaction value of not exceeding Baht 18,197,461,082. However, the Company and TF received the letter dated 15 March 2017 from PR declaring its intention not to make an offer for sale of 168,817,500 shares in PB held by it in the Co-Tender Offer. Therefore, the number of ordinary shares in PB where the Company and TF shall offer to purchase from other shareholders of PB in the Co-Tender Offer (excluding ordinary shares in PB held by PR totaling 168,817,500 shares) will be 141,825,400 shares in total, equivalent to per cent of the total issued shares in PB. The number of ordinary shares in PB the Company is required to purchase from other shareholders of PB is not exceeding 70,912,700 shares and the number of ordinary shares in PB TF is required to purchase from other shareholders of PB is not exceeding 70,912,700 shares. If, following the tender offer for all securities in PR pursuant to (2) above under which the Company has acquired ordinary shares in PR for per cent or more of total voting rights in PR, the Company will be considered acquiring significant degree of control in PR which is a juristic person with an existing shareholding in PB, amounting to per cent, under the chain principle pursuant to the Notification TorJor. 12/2554. In this regard, the Company is required to accumulate the amount of shares in PB held by it and the amount of shares in PB held by PR (as a juristic person with an existing shareholding in PB) for the determination of the requirement to make a tender offer for all securities in PB under the chain principle. In such case, the Company will be required to make a tender offer for all securities in PB for the second time under the chain principle. However, such case is the case where a waiver of the requirement to make a tender offer for all securities in PB for the second time under the chain principle has been granted to the Company by the Business Takeover Panel, the Office of Securities and Exchange Commission. Therefore, in the case where the amount of shares in PR being acquired by the Company reaches per cent or more of total voting rights of PR pursuant to (2) above, the Company will not make a tender offer for all securities in PB for the second time under the chain principle. Based on the foregoing, if shareholders of PB wish to sell their shares in PB after obtaining information regarding the expected change in overall shareholding structure of all related companies as well as any impacts on the shareholding structure of PB, the shareholders may sell their shares in PB upon the making of tender offer for all securities in PB by the Company jointly with TF as a result of the EBT between the Company and PH as mentioned above, even though the Company is not required to make a tender offer for all securities in PB for the second time under the chain principle since the waiver has been granted. Moreover, shareholders of PB will not be disadvantaged by their shares selling price since the price at which the Company will tender for all securities in PB jointly with the Company will be in the range of the fair value price which the Company has acquired PB shares under the EBT. Such price shall not be less than the price which reflects the cost of the Company s acquisition of significant control of PB via PR under the chain principle pursuant to the Notification TorJor. 12/2554. In the case where shareholders of PB do not sell their shares to the Company and TF in the tender offer for all ordinary shares in PB by the Company and TF as 11

13 abovementioned, shareholders of PB may sell their shares on the SET or continuously hold shares in PB. After TF and PR having amalgamated and forming the New Co, the New Co will become shareholder of PB of not less than per cent but not exceeding per cent of the total shares with voting rights of PB. 1.2 The Parties Involved and the Relationship with the Company and the Connected Person of the Company Entire Business Transfer Transferee: Transferor: The Company President Holding Co., Ltd. (PH) Tender offer for all securities in PR Relationship with the Company: PH is the connected person of the Company since the major shareholders of PH, namely: (1) Mr. Boonsithi Chokwatana, being the Chairman of the Board and Executive Chairman of the Company, holds 900,000 shares, equivalent to per cent of total voting rights in PH; and (2) Mr. Pipat Paniangvait, being the director of the Company, holds 900,000 shares, equivalent to per cent of total voting rights in PH. Offeror: Offeree: The Company Other shareholders of PR Tender offer for all securities in PB Relationship with the Company: The transaction is the making of a tender offer for all securities in PR to all other shareholders of PR under the same terms and conditions. Offeror: Co-offeror: The Company TF Relationship with the Company: TF has informed SPI in the letter dated 15 March 2017 of its intention to participate in making a tender offer for all shares in PB (Co-Tender Offer) and to purchase one-half of the number of shares tendered in the Co-Tender Offer for all shares in PB jointly with the Company. TF s intention to make the Co-Tender Offer for all shares in PB forms part of the proposed transaction so as to ensure that the New Co has increased its shareholding in PB upon completion of the amalgamation and becomes the Group s flagship company in food-sector businesses as being contemplated under the proposed transaction. In this regard, the Company and TF do not have or intend to have a relationship or act together in 12

14 any manner which may be considered as the acting in concert by virtue of the Notification TorJor. 7/2552. Offeree: Other shareholders of PB 1.3 General Characteristics and Transaction Size General characteristics Relationship with the Company: The transaction is the making of a tender offer for all securities in PB to all other shareholders of PB under the same terms and conditions. The Company intends to accept the entire business transfer of PH which undertakes the business of long-term lease of vehicles and machinery and investment business by holding shares in other companies by the method of the EBT, which is to be completed within the same day according to the details set out in the BTA, with the transactional value of approximately Baht 7,920,000,000. Upon completion of the EBT, the Company will be required to make a tender offer for all ordinary shares in PR at the price of Baht per share and PB at the price of Baht per share in compliance with the duties after the acquisition of the ordinary shares of PR and PB by way of the EBT resulting in the shareholding in PR and PB exceeding the trigger point for making a mandatory tender offer as prescribed under the Notification TorJor. 12/2554. In this regard, TF is to make the tender offer for all ordinary shares in PB jointly with the Company (Co-Tender Offer), in which TF has informed to the Company of its intention to purchase one-half of all tendered shares under such Co- Tender Offer jointly with the Company. The tender offer for all securities in PR and PB will be an aggregate value of not exceeding Baht 23,308,737,876, the details of which is described above. Therefore, the EBT of PH including the tender offer for all ordinary shares in PR and PB which is a result of the EBT has the total value of approximately Baht 31,228,737, Transaction size and calculation of transaction size of asset acquisition The maximum transaction size in respect of the EBT and the mandatory tender offer for all securities in PR and PB as a result of the EBT mentioned above is approximately Baht 31,228,737,876. The calculation of the maximum transaction size is based on the latest audited financial statements of the Company, PR and PB in which the equity method is applied which have been audited by the auditor ended 31 December 2016 and the latest audited financial statements of PH which have been audited by the auditor ended 31 December 2016 and in accordance with the Acquisition and Disposal Notifications. Details on the calculation of the transaction size are as follows: 13

15 Financial Information for Transaction Size Classification Financial Information Unit: Baht Million The Company PH PR PB Financial Statements in which the equity method is applied Ended 31 December 2016 Financial statement Ended 31 December 2016 Financial Statements in which the equity method is applied Ended 31 December 2016 Financial Statements in which the equity method is applied Ended 31 December 2016 Net Tangible Assets* 22, , , , Total assets 25, , , , Net profit (loss) 1, , Remark: *Net Tangible Assets is calculated by total assets minus intangible assets, total liabilities and total minor shareholders equity. Basis for Transaction Classification Proportion of Acquisition or Disposition Basis for Transaction Classification EBT of PH Tender offer for all securities in PR Tender offer for all securities in PB Transaction size Asset Value Net Profit Value of Consideration Value of Securities Issued for the Payment No Securities Issued According to the calculation basis above, the highest transaction value from the calculation of the transaction size is per cent based on the total value of consideration basis. Upon including the value of all transactions on acquisition of assets of the Company and/or its subsidiaries entered into during the past 6 months of which the transaction size is 1.16 per cent based on the total value of consideration basis, the aggregate transaction size is per cent based on the total value of consideration basis. Therefore, the transaction is considered Class 1 Transaction under the Acquisition and Disposal Notifications. However, the abovementioned transaction is not considered as backdoor listing since the assets to be acquired under the transaction are mainly ordinary shares of listed companies in the SET with the highest transaction size calculated equals 50 per cent or more pursuant to the rules under the Acquisition and Disposal Notifications. The transaction is also considered to be the purchase or acceptance of transfer of the business of other companies or private companies by the Company pursuant to Section 107(2)(b) of the PLCA, therefore, the Company is required to disclose the information regarding the transaction to the SET, appoint an independent financial adviser to render opinion to shareholders on the transaction and convene a meeting of shareholders to resolve to approve the execution of the transaction by the votes of no less than three-fourths of total voting rights of shareholders attending the meeting with voting rights, excluding votes of interested shareholders. 14

16 1.3.3 General characteristics of connected transaction The acceptance of the EBT of PH which is its connected person due to the fact that major shareholders of PH namely: (1) Mr. Boonsithi Chokwatana, being the Chairman of the Board and Executive Chairman of the Company, holds 900,000 shares, equivalent to per cent of total voting rights in PH; and (2) Mr. Pipat Paniangvait, being the director of the Company, holds 900,000 shares, equivalent to per cent of total voting rights in PH, is considered the connected transaction under the type of transaction relating to assets or service pursuant to the Connected Transaction Notifications with the transaction value of approximately Baht 7,920,000,000. The value of the transaction which is based on the latest financial Statements ended December 31, 2016, in which the equity method is applied, of the Company which have been audited by the auditor ended 31 December 2016 is equivalent to per cent of the value of net tangible assets of the Company. The Company and/or its subsidiaries has no connected transaction with PH or related person of PH during the past 6 months. Thus it is considered a connected transaction under the type of transaction relating to assets or service of which the transaction value exceeds than 3.00 per cent of the value of net tangible assets of the Company. The Company is required to disclose the information regarding the transaction to the SET, appoint an independent financial adviser to render opinion to shareholders on the transaction and convene a meeting of shareholders to resolve to approve the execution of the transaction by the votes of no less than three-fourths of total voting rights of shareholders attending the meeting with voting right, excluding votes of interested shareholders. 1.4 Details of Acquired Assets ,000 ordinary shares in TF, equivalent to 0.09 per cent of total voting rights in TF acquired from the EBT under the BTA (a) General characteristics of the business TF is a public limited company with its ordinary shares listed as registered securities on the SET. TF was incorporated 15 February 1972 and has been listed on the SET since 7 December At present, TF has a registered capital of Baht 240,000,000 divided into 240,000,000 ordinary shares with a par value of Baht 1 per share and a paid-up capital of Baht 180,000,000 divided into 180,000,000 ordinary shares with a par value of Baht 1 per share. Its head office is located at 304 TF Building, Srinakarin Road, Huamark Sub-district, Bangkapi District, Bangkok TF operates the business of manufacturing and distribution of instant noodles, biscuits, fruit juices, packaging and etc., under various trademarks including Mama, Bissin, Homey, Green Mate and Taisun, etc. 15

17 (b) List of shareholders of TF List of shareholders of TF as at the date of closure of shareholders register book on 7 October 2016: No. Shareholders Shares 1 Saha Pathana Inter-Holding Public Company Limited 2 NISSIN FOODS HOLDINGS CO., LTD. Voting Right 39,520, ,146, Mr Wirapat Punsak-udomsin 12,353, Mr. Pipat Paniangvait 8,777, Uni Central Co., Ltd. 5,131, Saha Pathanapibul Public Company Limited 7 I.C.C. International Public Company Limited 4,347, ,661, Universe Beauty Co., Ltd. 3,559, Chokwatana Co., Ltd. 3,492, Mr Sanguan Tatiyakavee 3,138, Other shareholders 59,871, (c) Board of Directors of TF No. Directors Position 1 Mr. Boonsithi Chokwatana Chairman of the Board 2 Mr. Pipat Paniangvait Chief Executive Officer and Vice Chairman of the Board 3 Mr. Karmthon Punsak-Udomsin Vice Chairman of the Board 4 Mr. Suchai Ratanajiajaroen President 5 Mr. Poj Paniangvait Director 6 Mr. Kamthorn Tatiyakavee Director 7 Mr. Apichart Thammanomai Director 8 Mr. Boonchai Chokwatana Director 9 Mr. Vathit Chokwatana Director 10 Miss Pojjana Paniangvait Director 11 Mrs. Kulpatra Sirodom Chairman of Audit Committee and Independent Director 12 Thanpuying Angkab Punyashthiti Audit Committee and Independent Director 16

18 No. Directors Position 13 Mr. Chaiwat Maraprygsavan Audit Committee and Independent Director 14 Mr. Visith Chavasit Independent Director (d) 15 Mr. Saroj Chayavivatkul Independent Director Connected persons of the Company which hold shares in TF: (1) Mr. Boonsithi Chokwatana: Chairman of the Board and Executive Chairman of the Company and Chairman of the Board of TF: shareholding in TF of Mr Boonsithi and related person equals to 1.11 per cent of total voting rights of TF. (2) Mr. Pipat Paniangvait: director of the Company and Chief Executive Officer and Vice Chairman of the Board of TF: shareholding in TF of Mr Pipat and related persons, i.e. Mrs. Rattana Paniangvait including close relatives of Mr. Pipat Paniangvait, equals to per cent of total voting rights of TF. (3) Mr Karmthon Punsak-Udomsin: director of the Company and director of TF: shareholding in TF of Mr Karmthon and close relatives equals to 8.68 per cent of total voting rights of TF. (4) Mr. Boonchai Chokwatana: director of the Company and director of TF: shareholding in TF equals to 0.03 per cent of total voting rights of TF. (5) Mr Boonpakorn Chokvathan: director of the Company: shareholding in TF of Mr Boonpakorn and related persons equals to 2.00 per cent of total voting rights of TF. (6) Ms Sirikul Thanasarnsilp: director of the Company: shareholding in TF of Ms Sirikul and close relatives equals to 0.08 per cent of total voting rights of TF. (7) Mr Palm Leelanuwatana: close relative to Mr Manu Leelawatana (director of the Company): shareholding in TF of Mr Palm equals to per cent of total voting rights of TF. (8) I.C.C. International Public Company Limited: a juristic person having Mr Boonsithi Chokwatana (Chairman of the Board and Executive Chairman of the Company) and related persons as major shareholders: shareholding in TF of I.C.C. International Public Company Limited equals to 2.03 per cent of total voting rights of TF. (9) Vitayasithi Co., Ltd.: a juristic person having Mr Boonsithi Chokwatana (Chairman of the Board and Executive Chairman of the Company) and Mr Boonkiet Chokwatana (director of the Company) as major shareholders: shareholding in TF of Vitayasithi Co., Ltd. equals to 0.02 per cent of total voting rights of TF. (10) People's Garment Public Company Limited: a juristic person having Mr Boonsithi Chokwatana (Chairman of the Board and Executive Chairman of the Company) and related persons as major 17