TORONTO — The Bank of Nova Scotia and its Thai affiliate, Thanachart Bank, have reached an agreement to acquire nearly 48 per cent of Thailand’s Siam City Bank from the country’s Central Bank.
The deal, which is subject to regulatory approvals in Thailand is worth a reported $984 million.
Scotiabank (TSX:BNS), which owns 49 per cent of Thanachart, said Thursday it was keen to merge the two Thai banks together.
Once the current deal is complete Thanachart plans to launch an offer for the remaining shares in Siam City to combine the two banks.
Scotiabank will continue to own a 49 per cent stake in the merged bank. Thanacart Capital Pcl will own the remaining 51 per cent.
Scotiabank which has had a presence in Thailand since 1981, said it plans to contribute about C$650 in capital to the merged bank.
“On closing, this transaction would be immediately accretive to Scotiabank and is a prime example of the significant potential in international markets,” said Rob Pitfield, Scotiabank’s group head of international banking.
Siam City has about C$13.6 billion in assets making it the eight-largest commercial bank by assets in Thailand. Once combined with Thanachart, the new bank will have more than 660 branches and 18,000 employees.
“We look forward to the completion of the transaction and the merger with Siam City Bank, which will create the fifth largest bank in Thailand,” said Banterng Tantivit, chairman of Thanachart Bank.
