Mr. Chaiwat Kovavisarach, President and Chief Executive Officer of Bangchak Corporation Public Company Limited (BCP), revealed that the Board of Directors resolved to approve an amalgamation between BBP Holding Company Limited (BBH), a subsidiary in which BCP holds a 99.99% stake, with KSLGI Company Limited (KSLGI), a subsidiary to be established by Khon Kaen Sugar Industry Public Company Limited (KSL), to which KSL will transfer its 99.99% of the total issued shares in KSL Green Innovation Public Company Limited (KGI).
The Amalgamation will establish a new company which will become Thailand’s largest manufacturer of biofuels with a total production capacity of 1,710,000 liters per day, consisting of ethanol and biodiesel (B100) with the ethanol production capacity of 900,000 liters per day and B100 production capacity of 810,000 liters per day. This will strengthen the position of its business, enhance its marketability and negotiation power and improve its financial position and operating results. Additionally, it will also diversify risks relating to the cost volatility of raw materials consisting of fresh cassava, cassava chips, molasses, and crude palm oil, ensuring greater competitiveness, and through information sharing, administration and management strategy, improve the efficiency and effectiveness of its business operations, manufacturing and distribution, as well as open new opportunities for agriculturists to cultivate a greater variety of energy crops.
The business partnership in the production of biofuels, specifically ethanol and B100, was formalized with the signing of the Amalgamation Agreement on 19 July 2017, forming the foundations for the establishment of a new company to called BBGI Company Limited (BBGI) this October, with a registered capital of 2,532 million Baht, serving as a flagship company, with Bangchak and Khon Kaen Sugar Industry holding a 60% and 40% stake in the company, respectively.
The Amalgamation will adhere to the procedures and provisions of the Civil and Commercial Code concerning partnerships and companies (as amended). The shareholders’ meetings of BBH and KSLGI will approve the Amalgamation and will arrange the joint shareholders’ meeting according to the procedures and within the time required by law in order to consider and approve various matters relating to the establishing of the new company, e.g. memorandum of association, articles of association, share allocation to BCP and KSL as shareholders of BBH and KSLGI (respectively), and the appointment of directors and an auditor. The amalgamation is expected to be completed in October 2017.
The company will continue to develop and add value to bio-based products in line with the Thailand 4.0 strategy and vision of Evolving Greenovation, to be the leading Asian Greenovative Group, founded on good corporate governance, through inclusiveness and sustainability.