Despite a slowdown in the construction sector, Thai steel firms are firming up their business plans. While 2S Metal is expanding overseas, PAE is raising funds for future growth.
2S Metal acquires Laotian steel maker
The Board of Directors of 2S Metal PCL (2S) has approved to purchase 900,000 common shares of Laotian firm Grand Steel Pipe Industry (GSP) from Tsang Mo Ngan, the sole shareholder of GSP, for 70 million baht ($1.98 million).
2S will pay 1 million baht in cash to Tsang Mo Ngan and provide loan supports of 69 million baht. This transaction is considered to be an acquisition of assets but the value is not disclosed.
GSP, a manufacturer of steel products, is headquartered in Vientiane Capital, Laos. It has a registered and paid-up capital of $1 million, divided into 1 million common shares with a par value of $1 each.
Sombat Leeswadtrakul, chief executive officer of 2S, said in the statement that this deal was a part to help it expand the steel business in Laos.
After the acquisition, 2S will hold 90 per cent of the registered capital and Ms Kusuma Mongkolsurbsakul, an individual investor, will hold 10 per cent.
PAE rights issue to fetch $29.4m
PAE (Thailand) PCL, a manufacturer of structural steel for oil and gas industry, plans to raise 1.039 billion baht ($29.4 million) via a rights issue, which will seek the approval for this capital increase from shareholders in the extraordinary meeting on October 30.
It will issue 6.926 billion new shares to the existing shareholders. One existing share will be equal to 2.5 new shares at the price of 0.15 baht each.
The company’s chief executive officer Urairat Boonakat told the media yesterday that this fund-raising would be used to repay the debt and invest in both existing and new businesses.
“Despite the global economic slowdown, our customers still have demand for structural steels for their maintenance. Plus, they believe that the situation has reached the bottom so they move forward their investment to serve the rising demand after the Asean Economic Community is inaugurated,” she said.