• 
• 

Published on December 25, 2007

DBS's existing 16.1-per-cent stake in TMB is expected to be reduced to 6.8 per cent, assuming full subscription of the proposed offer, the bank said a statement.

The statement came after an earlier offer by DBS aimed at seeking greater control in Thailand's fifth-largest bank was declined by TMB's board, which opted for the Dutch-based ING Group's offer instead. DBS had at that time teamed up with Deutsche Bank to subscribe to TMB's new shares.

Under the recapitalisation plan, TMB will increase its capital by issuing 25 billion new shares.

About 13.1 billion of them will be allocated to ING for Bt1.60 apiece. The remaining shares will be allocated to the Finance Ministry and other existing shareholders at Bt1.40 each.

"DBS's decision not to subscribe to its share of the offer is consistent with its intention to reduce its participation in the strategic direction of TMB, given the change in TMB's post-recapitalisation shareholding structure," the bank said.

Thailand is an important market in Asia, and DBS will continue to work with the Finance Ministry and the Bank of Thailand as it assesses its options in the country, it added.

DBS's presence in the Kingdom began in 1993 when it obtained a Bangkok Inter-national Banking Facility (BIBF) licence. In 1998, DBS acquired a majority stake in what was subsequently renamed DBS Thai Danu Bank (DTDB). With the DTDB acquisition, DBS gave up its BIBF licence in 2000 and maintained a small representative office in Bangkok.

In 2004, DTDB - together with the Industrial Finance Corp of Thailand - was merged into Thai Military Bank (TMB) to create Thailand's fifth-largest bank by assets. DBS is the second-largest shareholder in TMB, with a 16-per-cent interest.

 The Nation