TRIS Rating has placeed the company rating of Capital Nomura Securities PLC (CNS) on CreditAlert with “positive” implication. The rating action follows CNS’s announcement of a voluntary tender offer (VTO) by Nomura Holdings Inc. to acquire all shares of CNS. The VTO is subject to the approval of CNS’s shareholders to amend the company’s foreign ownership limit stipulated in the Articles of Association.
Nomura Holdings is Japan’s largest securities firm, holding a 38.63% stake (25.11% direct ownership and 13.52% through its subsidiary) in CNS as of March 2014. Nomura Holdings recognizes the importance of CNS not only due to the continuous growth in the securities market in Thailand, but also from the perspective of regional expansion into countries, such as Lao PDR, Myanmar, and Cambodia. Nomura Holdings aims to utilize CNS’s business platform to facilitate the establishment of unified strategies in Thailand and surrounding countries within the Nomura Group.
In TRIS Rating’s view, if the VTO succeeds as planned, the strengthened relationship will allow CNS to better leverage the global platform and products of the Nomura Group. The stronger financial and business support will potentially enhance CNS’s credit rating. The CreditAlert can be resolved in two directions. If the amendment on the foreign ownership limit is not approved by the shareholders in the annual general meeting scheduled on 25 April 2014, CNS’s rating outlook will be changed back to “stable”. On the other hand, if the amendment is approved and the tender offer is completed, CNS’s credit strengths under the new ownership structure will be reviewed.
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