Proud Real Estate Public Company Limited (SET:PROUD) enter into a share sale and purchase agreement to acquire 50% stake in Phraram 9 Alliance and Khu Khot Station Alliance from TNL Alliance Co for THB 1.58 billion on May 26, 2023. Disposition of 3,840,000 ordinary shares in PA9, with a par value of THB 100 per share, representing 50% of all shares of PA9, and transfer of the right of TNLA to claim a portion of the loans (consisting of principal and interest) owed to TNLA by PA9 as of the date before the share transfer date; and Disposition of 1,500,000 ordinary shares in KK, with a par value of THB 100 per share, representing 50 percent of all shares of KK, and transfer of the right of TNLA to claim a portion of the loans (consisting of principal and interest) owed to TNLA by KK as of the date before the share transfer date. The total value of consideration for the Transaction consists of the initial purchase price for the sale and purchase of all ordinary shares held by TNLA in PA9 and KK in the total amount of THB 290 million, the purchase price for the rights of TNLA to claim a portion of the loan owed by PA9 and KK as of the date before the share transfer date in the total amount of THB 210 million; and the value of claims on loans that PA9 and KK will repay to TNLA on the share transfer date which is expected to be THB 370 million, The total value of consideration that TNLA will receive under (1) ? (3) is THB 870 million; and the value of guarantee obligations that the Company guarantees for the loan of KK, amounting to THB 710 million. The transaction will be financed from offering of newly issued ordinary shares THB 623 million, Loan from a commercial bank approximately THB 1,290 million and offering for sale of preference shares approximately THB 600 million.
In this regard, the initial share purchase price will be subject to adjustment to reflect the difference between the pro forma financial statements used to determine the initial share purchase price and the financial statements as of the date before the share transfer date, which will be prepared later according to the terms of the Share Purchase Agreement. The transactions will occur only when each party has fulfilled all of the conditions precedent specified in the Share Purchase Agreement. The Company expects that all conditions precedent will be met by July 24, 2023. PROUD having obtained shareholders' meeting approvals for the sale and purchase of shares and other procedures pursuant to the Share Purchase Agreement, PROUD having received funds for the transactions under the Share Purchase Agreement and the construction of the projects of PA9 and KK, including an approval of the amendment to bank loan facilities agreements for PA9 and KK; KK having transferred the Other Projects to the juristic persons whose shares will be held by the sellers; PA9 and KK having terminated service agreements with TNLA and Noble and entered into a novation agreement to acquire rights and obligations of Noble in relation to the project construction agreement between Noble and the relevant contractors; PA9 and KK having obtained necessary consent or confirmation from their bank lenders; and Noble and PROUD having mutually agreed on the terms and conditions of project management agreements for Noble to manage the projects of PA9 and KK (including the use of Noble?s trademarks for project operations) after the share transfer date. The Company plans to utilize the proceeds from the Transactions to support its liquidity position and supplement working capitaland set aside a portion as a reserve fund for future business expansions to further augment its capabilities in line with its potential. The Board of Directors of the Company unanimously approved the Transaction. Silom Advisory Co., Ltd acted as financial advisor and opinion provider to Proud Real Estate. Baker & McKenzie Ltd. acted as legal advisor to Proud Real Estate Public Company Limited.