F&N Said to Deem Charoen’s $7.3 Billion Offer as Not Compelling

Fraser & Neave Ltd. plans to say that Thai billionaire Charoen Sirivadhanabhakdi’s $7.3 billion takeover offer isn’t compelling and undervalues some of its assets, said people with knowledge of the matter.

F&N’s board is likely to say tomorrow the S$8.88 ($7.21) a share bid is fair, based on recommendations from adviser JPMorgan Chase & Co., said the people, who asked not to be named because the matter is private. Still, F&N is likely to add that the bid undervalues its properties and its brewing assets in Myanmar, according to three of the people.

Charoen, through Thai Beverage Pcl (THBEV) and TCC Assets Ltd., in September offered S$9 billion for the 70 percent of Singapore- based F&N he didn’t already own. F&N shareholders last month agreed to sell the company’s 40 percent stake in Tiger beer maker Asia Pacific Breweries Ltd. (APB) for S$5.6 billion to Heineken NV. (HEIA)

Jennifer Yu, a spokeswoman for F&N, declined to comment. A JPMorgan official declined to comment on the firm’s recommendation.

TCC Assets owns or has commitments for 33.5 percent of F&N’s shares, according to an statement to Singapore’s stock exchange today.

On Oct. 8, F&N said it recorded a “revaluation surplus” of about S$498 million on some of its properties, including The Centrepoint shopping mall on Singapore’s Orchard Road. The company is still reviewing the value of real estate under development and its property management business, it said.

To contact the reporter on this story: Joyce Koh in Singapore at jkoh38@bloomberg.net

To contact the editor responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net

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