Syrus, Finansa shares gain on merger

Syrus stock started with a sharp rise and surged further to a day's high at Bt3.60 - a 28.57percent increase - before retreating to close at Bt3.30, for a 17.86-percent gain.

Finansa, the parent of Finansa Securities, also gained at the opening bell but its rise was at a slower pace and it closed at Bt3.44, 7.5 per cent up.

ACL Bank, the parent of ACL Securities, slumped at the opening bell and ended the day at Bt3.06, down 8.93 per cent.

ACL Bank and Finansa have since April 20 jumped 41.66 per cent and 22.86 per cent, respectively, while Syrus has risen 43.48 per cent since April 22.

ACL Bank president Thongchai Ananthothai said in a press briefing yesterday that only the brokerage and derivatives brokering units of the three companies would be integrated, in order to sharpen competitive¬ness for the full deregulation of stock commissions - slated for 2012.

According to the stock regulator's schedule, the current minimum commission fees of 0.25 per cent and 0.20 per cent of transaction value for traditional and online trading, respectively, will be shifted to a sliding scale next year before full liberalisation is implemented.

Following the amalgamation, ACL Bank will support the transactions and customer base of the merged entity. It expects the merged firm will provide a return on equity of 1015 per cent.

Syrus Securities president Somphop Kheeasuntonpong said the merged firm would have about 18,000 accounts, 600 staff and 23 branches nationwide.

Ninety per cent of the merged entity will be retail investors and the remainder institutional investors.

Somphop could not disclose details of the management structure, as it depends on the company's board.

Syrus expects to spend Bt500 million on the deal, all of which derives from cash flow from operations, he said.

Under the plan, Finansa will transfer assets to Syrus in exchange for 59 million existing shares of Syrus, accounting for 25 per cent, while Syrus will issue 79 million new shares in return for 100 million shares of ACL Securities.

The sale and transfer of the assets, including transfer of employees, customer portfolio and debt refinancing of customers in the credit-balance system, will be made upon satisfac¬tion of the assets duediligence results.

Finansa Securities managing director Chuangchai Nawong said the merger would create business syner¬gy, particularly with regard to selling costs.

The new company will initially have no policy to lay off any of the 600 staff, but a committee will be set up to put the right people into the right jobs, he said.

Finansa managing director Vorasit Pokachaiyapat said his company's cash flow would be raised to Bt600 million after the transaction is completed in June.

Finansa and ACL Bank will together own 24.9 per cent of the new company, he said.