Bangkok-headquartered Thai Union Group Public Company Limited (TU), one of the world’s leading suppliers of frozen and canned seafood, has successfully completed the book building for THB 12,000 million (about $339 million) in new debentures to secure long-term financing for its investment in Red Lobster Seafood Co.
The debentures were the largest ever issued by Thai Union. The three, five, seven and 10-year bonds attracted strong support from institutional investors, and were oversubscribed by 2.6 times. The coupon for the three-year debentures is 2.49% p.a.; for five-year debentures, 2.91% p.a.; for seven-year debentures, 3.58% p.a.; and 3.94% p.a. for the 10-year debentures. Bangkok Bank PCL, Bank of Ayudhya PCL, and Siam Commercial Bank PCL were lead managers.
Thai Union has also secured THB 12,500 million (approximately $354 million) in long-term loans. Bangkok Bank PCL, Bank of Ayudhya PCL, Sumitomo Mitsui Banking Corporation, Bangkok Branch were the lead arrangers, while Kasikornbank PCL, Mizuho Bank, Ltd., Standard Chartered Bank (Thai) PCL and Bank of China (Thai) PCL were co-arrangers.
“The robust participation of investors in our book building reflects the confidence they have in Thai Union,” said CEO Thiraphong Chansiri. “The result, which is important in ensuring we have the necessary long-term financing for our strategic investment in Red Lobster, also indicates that the market supports our strategy for growth and expansion.”
Thai Union Group CEO Thiraphong Chansiri (center) meets with representatives of financial institutions involved in funding its investment in the Red Lobster restaurant chain. They are (left to right): Nitiphong Tejavanija of Standard Chartered Bank (Thai) PCL, Suwat Techawatanawana of Kasikornbank PCL, Pimolpa Suntichok of Siam Commercial Bank, Narin Opamuratawongse of Bangkok Bank, Pichai Dusdeekulchai of Sumitomo Mitsui Banking Corporation, Somchai Thusanagraivuth of Bank of China (Thai), Suratun Kongton of Ayudhya, and Visut Kittisamuth of Mizuho Bank, Ltd.
The company will use proceeds from both the bonds and the long-term loans mostly to finance the $575 million investment in Red Lobster, the world’s largest seafood restaurant operator. The acquisition, announced last October, gives Thai Union 25% ownership of the Orlando, Florida-headquartered company’s common shares and 24% of its preferred stock on a fully diluted basis. San Francisco-based Golden Gate Capital remains the majority owner and retains operational control of the business.
“Red Lobster is an iconic brand, with a leading market position in seafood casual dining and a world class management team, and has delivered strong performance since Golden Gate acquired the company [from Darden Restaurants] in 2014,” said CEO Thiraphong. “This investment marks a strategic step to build our direct-to-consumer channel, and will enable us to benefit from the extensive restaurant industry expertise of both the Red Lobster management team and Golden Gate.”
