Thai takeover opens exit door for coveted F&N chairman Lee

Sun Jan 27, 2013 5:32pm EST
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By John O'Callaghan and Saeed Azhar

SINGAPORE (Reuters) - Lee Hsien Yang, the brother of Singapore's prime minister and chairman of Fraser and Neave Ltd (F&N), will enter a new chapter in his corporate life - and could well leave F&N - as the group looks set to be taken over by Thailand's third-richest man.

Lee, 55, the second son of Singapore's founding leader Lee Kuan Yew, oversaw a bidding war for F&N (FRNM.SI: Quote) that led to Southeast Asia's biggest corporate takeover. The deal values the 130-year-old drinks and property conglomerate at around $11 billion and will reward shareholders handsomely.

Despite some friction with Lee's board, there are compelling reasons for Charoen Sirivadhanabhakdi to keep on the astute, well-connected scion as the Thai beer baron looks to unlock value from F&N's drinks business, distribution networks and premier properties.

"He will leave F&N - that's my sense," said Mano Sabnani, a minority shareholder and former senior executive at a Singapore newspaper. "If they wanted him and they asked him then maybe. But Hsien Yang is a very capable chap. For him to get other roles is not a problem."

Lee's future is sure to be a hot topic at a shareholder meeting on Tuesday.

Lee holds 180,000 F&N shares directly, a company filing showed in December, and he is one of three trustees of 408,240 shares held by the estate of Kwa Siew Tee. Kwa is the late father-in-law of Lee Kuan Yew.

Another filing from 2007 shows Lee Hsien Yang bought the direct shares on November 23 of that year at S$5.65 each. At the Thai takeover price of S$9.55 per share, he will make a profit of S$702,000 ($571,600) if he sells to the Thais.

If Lee does leave F&N, the impact will be minimal as the senior management is intact and the business carries on, said a source close to the transaction, speaking on condition of anonymity.   Continued...

Then SingTel Chief Executive Lee Hsien Yang arrives at the Federal Court in Sydney in this April 5, 2006 file photo. REUTERS/Will Burgess/Files