Bank of Ayudhya and GE Capital Reach Agreement In-Principle
Exclusive negotiations under way for BAY to acquire GE Money’s consumer financial services businesses in Thailand to create further synergies for long-term growth
BANGKOK, THAILAND Bank of Ayudhya PCL (BAY) and GE Capital (NYSE: GE) today announced that they have reached an in-principle agreement on the sale of GE Money’s businesses in Thailand to BAY. The preliminary agreement follows approval of indicative terms of the prospective acquisition at BAY’s Extra-ordinary Board of Directors meeting (No 5/2009) held on 9 July. The proposed transaction is subject to various regulatory, corporate and shareholder approvals, as well as the completion of a definitive agreement. If closed, the transaction would represent an investment of approximately Baht 13.75 billion (or approximately USD391million) subject to closing adjustment.
Mr.Veraphan Teepsuwan, BAY’s Chairman said, "The prospective purchase of GE Money, one of the largest consumer finance businesses in Thailand, is an innovative move forward. It will leverage the BAY-GE synergies and at the same time, enhance BAY’s competitiveness and economies of scale. This will be another key milestone indicating the strength of our partnership and further reflects GE Capital’s commitment in BAY.”
Mr. Dmitri Stockton, President and CEO of GE Capital Global Banking said, “We have enjoyed a strong and productive relationship with our colleagues at BAY, and this transaction meets our corporate objectives of building scale and leveraging the strength of our partnerships in key emerging markets. Bringing these two successful organizations together will allow us to maximize value for our shareholders and strengthen our ability to serve customers.”
GE Money Thailand is the country’s largest card issuer, with over 2.2 million cards in circulation through its Central and Robinson credit cards and joint ventures with Tesco and Bank of Ayudhya (“Krungsri Credit Card”). GE Capital also has a strategic investment in BAY and holds a 33 percent stake in the bank. The move would further enhance GE Capital’s participation in the bank and enable BAY to build on its strong platform and execute its growth plans.
BAY and GE Money Thailand will continue to operate “business as usual” and further details will be announced upon the conclusion of these discussions.
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