Siam Cement delays SCGC IPO citing adverse economic climate

The initial public offering (IPO) of Siam Cement Group‘s subsidiary, SCG Chemicals Plc (SCGC), has been delayed. Citing the company’s large size and the current adverse economic and investment climate, the parent company, Siam Cement Group (SCG), did not provide a new timeline for the IPO. This announcement was made by Roongrote Rangsiyopash, the President and Chief Executive of SCG.

On April 12 this year, an extension was secured from the SEC for IPO approval until October 4. This period can’t be extended further as per Capital Market Supervisory Board notifications.

Postponing the IPO and SET listing of SCGC shares was due to factors like investor readiness, energy crisis, market conditions, and investor confidence, Roongrote explained.

“We’ve concluded it’s not the right time for the IPO. SCG trusts SCGC’s potential as an ASEAN chemicals player, given its expansion and global partnerships.”

SCG plans to proceed with the IPO when conditions improve, involving resubmitting for SEC approval, registration, and draft prospectus. The company will keep stakeholders informed about progress.

SCGC, one of SCG’s primary revenue contributors, was spun off and filed with the SEC to prepare for fundraising and listing on the SET. With a registered capital of approximately 114 billion baht, the SCGC IPO could potentially be one of Thailand’s most valuable. Once listed on the SET, it would be included in the SET50 and SET100 indices within three business days, following the fast-track listing criteria.

SCGC plans to list 3.85 billion shares, amounting to 25.2% of the company.

In the petrochemical sector, SCGC’s 2022 revenue surged 62.3% to 239 billion baht, accounting for 45% of SCG’s total revenue. SCGC’s net profit impressively grew 129% to 43.1 billion baht, making up 61% of SCG’s profit. With assets totalling 377 billion baht, equivalent to 43.8% of SCG’s total assets, SCGC stands as SCG’s prime unit in income, profit, and assets.

The proceeds from the IPO would be used by SCGC to fund domestic and international business expansion, bolster liquidity, and provide working capital for future operations.

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