MUFG seeks Ayudhya deal in July

Bloomberg

Mitsubishi UFJ Financial Group Inc. is seeking to strike a deal for control of Thailand’s Bank of Ayudhya Pcl as soon as this month, two sources said.

Japan’s biggest bank plans to acquire about half of Bank of Ayudhya through a tender offer to shareholders, including General Electric Co., which owns about 25 percent of the lender, the sources said, asking not to be identified as the information is private. Its Bank of Tokyo-Mitsubishi UFJ Ltd. unit is planning to hold a board meeting to approve the plan, one source said.

The tender offer could be made around September, although that timeline depends on approval for the purchase from Thai authorities, according to the sources.

The purchase would give Mitsubishi UFJ a bigger platform to expand retail and corporate banking in Southeast Asia. The deal would be the largest for a Thai bank, based on Bank of Ayudhya’s market value of more than $7 billion, data compiled by Bloomberg show. Japan’s biggest banks are buying assets in faster-growing markets to counter shrinking loan profitability at home.

Mitsubishi UFJ wants to ally with the Ratanarak family, which owns a 25 percent stake, to manage Bank of Ayudhya after a deal is sealed, the sources said. Mitsubishi UFJ is in talks with the family to gain seats on the bank’s board, another source said.

Yuji Okumura, a Tokyo-based spokesman for Mitsubishi UFJ, declined comment on the deal. Bank of Ayudhya hasn’t received any notification from GE that a deal has been entered into, the Thai company said in a regulatory filing Tuesday.

The purchase would also be the biggest banking takeover in Asia by a Japanese bank.