Temasek Group Pares Stake in Shin Through $687 Million Sale

Temasek Holdings Pte and its partners sold 20.9 billion baht ($687 million) of Shin Corp. shares, paring its stake in the company that controls the biggest Thai mobile-phone operator.

Singapore’s state-owned investment company and its partners in Cedar Holdings Ltd. sold 330 million Shin shares at 63.25 baht each, Shin said in a statement. That was a 5.6 percent discount to the close yesterday, and cuts the group’s stake to about 13.3 percent from 23.6 percent, according to Shin.

“It has always been the strategy of Temasek to pare down its investments in telecommunications companies across the region,” said Thapana Phanich, an analyst with Deutsche Bank AG in Bangkok. “I expect them to sell another stake in Shin Corp. However, they might want to maintain a slim majority.”

Temasek, which managed S$198 billion ($161 billion) of assets as of March 2012, said in June it’s seeking investment opportunities as the turmoil in Europe may result in a market slump rivaling the 2008 global financial crisis. The company sold shares of Singapore Telecommunications Ltd. last year, the biggest holding in its portfolio.

The state-owned investment company said in an e-mailed statement that Cedar is an associate and it’s not in a position to comment on the offer as a minority holder.

Shares of Shin fell 3.7 percent in Bangkok, poised for their biggest drop since August 27. The benchmark SET Index rose 0.1 percent.


About 80 percent of the shares were sold to Thai NVDR Co., and the rest to Thai investors, Shin said.

Thai NVDR was established by the Stock Exchange of Thailand in 2000 to boost investment in Thai stocks, according to the bourse’s website. Investors in NVDRs don’t have voting rights, though receive the same financial benefits as holders of a company’s ordinary shares. The use of NVDRs allows Thai companies and overseas investors to circumvent Thailand’s foreign ownership restrictions.

A Temasek-led group bought Shin in 2006 from the family of Thaksin Shinawatra, who was Thailand’s prime minister at the time, and later raised its stake in the company to more than 96 percent. Temasek now owns 42 percent of Shin, and Cedar has a 13 percent stake, according to data compiled by Bloomberg.

Temasek bought Shin through Aspen, a wholly-owned unit, and Cedar, in which it had a 49 percent stake, Temasek said at the time of the original purchase. The partners in Cedar were Siam Commercial Bank Pcl and Kularb Kaew Co., according to Temasek.

Aspen Queried

Kularb Kaew is 28 percent owned by Temasek unit Cypress Holdings and Thai investors own the remainder, the Nation newspaper reported in 2006, citing an unidentified official at Thailand’s commerce ministry. Cypress has 90 percent of the voting rights in Kularb Kaew, with Thai shareholders limited to 10 percent, the Nation said. Temasek declined to comment on voting rights at the time.

Shin said it asked Temasek’s Aspen whether it also plans to sell shares.

“Aspen has informed the company that it has no immediate plan to sell its shares in the company and remains confident in the business and management of the company,” Somprasong Boonyachai, a Shin director, said in the exchange statement.

Shin gets almost all of its earnings from its 40 percent stake in Advanced Info Service Pcl, Thailand’s biggest mobile-phone company. Shin also owns 41 percent of Thaicom Pcl, the nation’s satellite operator, according to data compiled by Bloomberg.

The stake sale by Temasek’s group was first reported by FinanceAsia. The sale was managed by Credit Suisse Group AG and Morgan Stanley, along with Bualuang Securities Pcl and Siam Commercial Bank.

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