A Jay Mart mobile store. The private placement agreement helps the portfolios of both companies.

The board of directors of Jay Mart, a major distributor of IT products, listed on SET, has approved the issuance of 300 million new shares to the two subsidiaries of BTS Group Holdings through a private placement as part of the ‘a deal worth 10 billion baht.

After the deal, VGI Plc and U City Plc, both subsidiaries of BTS, will respectively own 15% and 9% of the total shares of Jay Mart.

Jay Mart Managing Director Adisak Sukumvitaya spoke with the Bangkok Post after Thursday’s board.

The deal is due to be approved at the general shareholders’ meeting at the end of October.

Jay Mart’s subsidiary JMT Network Services, which provides a bad debt collection service, plans to raise capital of 10 billion baht.

Some 5.4 billion baht will be raised by Jay Mart, who owns 54% of the capital of JMT, while an additional 4.6 billion is expected to be raised by other shareholders.

U City plans to spend 8 billion baht to buy shares in Jay Mart’s subsidiary, Singer, after which it would own 24.9% of Singer.

Mr. Adisak called the deal a “super synergy” between BTS and Jay Mart, while around 30 billion baht is expected to flow into Jay Mart and its subsidiaries.

Currently, Mr. Adisak and his family own a 46% stake in Jay Mart and the new deal would reduce their stake to 35%.

The two BTS subsidiaries will hold a combined 24.9% stake in Jay Mart.

BTS Group Holdings engages in public transport, media, real estate and services, while Jay Mart has a main activity in the distribution of computer products, but has expanded its presence in personal loans, management of non-performing debt, high purchase loans for electrical appliances and real estate. real estate development.

Pisut Ngamvijitvong, senior equity research analyst at Kasikorn Securities, said the deal is seen as creating a business portfolio synergy for BTS and Jay Mart.

Both companies have diversified into areas where they add value to existing assets and realize their potential, he said.

Mr Pisut said BTS has diversified through investments in companies focused on the digital economy, such as digital marketing, insurance, e-commerce and tech startups.

He said Jay Mart, which started distributing handsets, has now expanded into several core businesses through its portfolio.

Jay Mart’s share price climbed 75 satang to close at 35 baht in a trade worth 1.4 billion baht on Thursday, while BTS’s share price fell 5 satang at 9.25 baht in a trade worth 206 million baht.

According to Bualuang Securities, BTS is expected to apply for loans to finance its purchase of Jay Mart shares, which could increase financial costs for the former.

BTS could also consider capitalizing on Jay Mart’s digital tokens in its trading ecosystem, Bualuang Securities said.

Sales of the newly issued shares can be used to fund other projects pursued by Jay Mart, including the personal loan business, operated by KBJ Capital, a joint venture between Jay Mart and Korea’s leading credit card operator. South KB Kookmin Card, the brokerage said.