PTT Said to Approach Banks as It Weighs Retail Business IPOJoyce Koh
PTT Pcl, Thailand’s biggest energy company, has approached potential advisers as it weighs options including an initial public offering for its retail business, people with knowledge of the matter said.
PTT has reached out to banks to solicit proposals for advising on a deal, said the people, who asked not to be named discussing private deliberations. An IPO of the unit, which operates PTT’s service stations, could raise more than $2 billion, they said.
At that size, it could become Thailand’s biggest-ever IPO, overtaking the $2.1 billion sale by BTS Rail Mass Transit Growth Infrastructure Fund in April 2013, according to data compiled by Bloomberg. PTT is exploring options for the unit after China Petroleum & Chemical Corp., known as Sinopec, last month agreed to sell a $17.5 billion stake in its retail operations to a group of investors.
“There’s a recognition among oil companies that they may not be the best owners of their retail and marketing assets as these are not their core competency,” said Neil Beveridge, a Hong Kong-based analyst at Sanford C. Bernstein & Co. “We saw that with Sinopec, and it follows very much in line with what Western oil companies have also done.”
PTT will probably appoint banks to advise it on the restructuring in November, the people said. Shares of the company rose 4 percent in Bangkok trading, the biggest advance in more than seven weeks, making it the biggest contributor to gains in the benchmark SET Index.
A call to PTT Chief Financial Officer Wirat Uanarumit went unanswered. Chief Executive Officer Pailin Chuchottaworn in June told the Nation newspaper the company may list the retail unit, without saying how much an IPO could raise.
PTT operates 1,382 service stations across Thailand, according to the company’s 2013 annual report. In 2007, it acquired ConcoPhillips’ fuel stations and Jiffy convenience stores in the country for $281 million, data compiled by Bloomberg show.
In April, PTT’s oil and natural gas explorer unit, PTT Exploration & Production Pcl, agreed to pay about $1 billion cash for Hess Corp.’s stakes in oil and gas assets in Thailand.