Yoma Strategic to spin off Myanmar tourism businesses

Mr Pun says Yoma Strategic's moves in Myanmar will unlock better value for shareholders in the long run.
Mr Pun says Yoma Strategic's moves in Myanmar will unlock better value for shareholders in the long run.

The Singapore Exchange (SGX) is poised to have its first Myanmar tourism-focused business.

Yoma Strategic Holdings yesterday said it will be spinning off its tourism-related business as part of a reverse takeover (RTO) of Catalist-listed SHC Capital Asia.

Yoma on Sept 2 announced its aim to partner with other players and set up a platform engaged in tourism-related businesses focused on Myanmar, and its acquisition of the remaining 25 per cent interest in "Balloons over Bagan" through its 70 per cent-owned subsidiary, Chindwin Holdings.

The platform intends to be the first Myanmar-focused tourism company listed on the SGX following the proposed RTO, Yoma said.

It wholly-owned subsidiary, Yoma Strategic Investments (YSIL), has signed a conditional sale and purchase agreement for the proposed sale of its tourism-related businesses with SHC.

These tourism-related businesses comprise Balloons over Bagan; Pun Hlaing Lodge1, a proposed hotel development in Hlaing Tharyar Township in Yangon, now under construction; and a parcel of land in Nyaung U intended for a proposed commercial and tourism-related hospitality development.

First Myanmar Investment Company (FMI), which has a 30 per cent interest in both Balloons over Bagan and the Bagan Land is also party to the agreement and it will take part in the proposed RTO through the sale of its interest in these businesses to SHC.

SHC will simultaneously acquire additional tourism-related businesses comprising Hpa-An Lodge, a hotel/lodge business, and Asia Holidays, a Myanmar- based destination management company. Following the proposed reverse takeover, SHC will transform into a Myanmar-focused tourism company.

Mr Serge Pun, Yoma Strategic's executive chairman, said: "Tourism is a significant economic driver in Myanmar, and we believe the divestment of our tourism-related assets into a dedicated platform in partnership with other tourism players in Myanmar will unlock better value for our shareholders in the long run."

A new chief executive officer, Mr Michel Novatin, has been identified to lead the management team of this tourism platform. Mr Novatin is an industry veteran with more than 40 years of experience in managing luxury hotels.

The transferred businesses and the additional tourism-related businesses will be injected into a target company which is then to be acquired by SHC for $70.68 million. The amount is to be satisfied by the issue and allotment of new consolidated SHC shares at an issue price of 26.3 cents.

YSIL will be issued 167 million SHC shares valued at $43.94 million, giving it a 53.48 per cent stake in SHC before any proposed compliance placement of SHC. FMI will be issued shares valued at $11 million.

A version of this article appeared in the print edition of The Straits Times on October 25, 2016, with the headline 'Yoma Strategic to spin off Myanmar tourism businesses'. Print Edition | Subscribe