Thai Union’s feedmill subsidiary, Thai Union Feedmill, hopes to raise USD 44.1 million (EUR 38 million) from its initial public offering on the Stock Exchange of Thailand to support its expansion plans.
The IPO price for the 109.3 million shares being offered has been set at THB 13.50 (USD 0.41, EUR 0.35) per share, worth around THB 1.5 billion (USD 44.1 million, EUR 38 million) in total. The listing of the shares is expected to begin on the Stock Exchange of Thailand later this month, according to a statement from TFM on 18 October.
TFM has selected Bualuang Securities as the financial advisor and underwriter for the IPO. Bualuang Securities Managing Director Pichet Sithi-Amnuay said the funds raised from the IPO will be used to aid TFM’s aquatic feed operations in Indonesia, to repay loans, and to augment the company’s working capital.
According to TFM CEO Bunluesak Sorajjakit, the additional funds from the IPO will help enhance the company’s competitiveness, as the company is in the process of expanding its business operations overseas. TFM is aiming to increase exports to Burma, Malaysia, and Sri Lanka, and is partnering with India’s aquaculture feed company, Avanti Feeds, to sell products under the TFM brand in India. The company is also considering setting up joint ventures with partners in Indonesia and Pakistan to support its growth in the next three to five years.
TFM currently operates feedmills in Muang Samut Sakhon and Songkhla, Thailand, together producing 273,000 metric tons (MT) of feed annually, comprised of 153,000 MT of shrimp feed, 90,000 MT of fish feed, and 30,000 MT of terrestrial animal feed. TFM said it accounts for 17 percent and 24 percent of total shrimp feed and sea bass feed sales in Thailand, respectively.
As of 2020, TFM had total assets worth nearly THB 2.5 billion (USD 74.8 million, EUR 64.2 million), up 11.5 percent from 2019. However, its sales value last year fell 13.8 percent year-on-year to THB 4.18 billion (USD 125 million, EUR 107.4 million). TFM’s net profit also tumbled 51.2 percent year-over-year to THB 410 million (USD 12.3 million, EUR 10.5 million) in 2020.
Thai Union currently holds 66.9 percent of issued shares in TFM, but that total will decrease to 51 percent after the IPO. Thai Union said in February the reduction of shares in TFM reflects part of the reorganization of its business structure.
Photo courtesy of Thai Union Feedmill
