Esso exits Thailand market as Bangchak completes acquisition

Esso Thailand’s 129 years of service in the country have come to an end as Bangchak Corporation (BCP) announces the completion of acquisition of a majority 65.99% stake in the petroleum company from ExxonMobil Asia Holdings.

Some 700 Esso Thailand’s petrol stations across the country will now be operating under Bangchak’s brand. Following the acquisition, the Thailand-based petroleum company now has an elevated petrol refinery capacity of 174,000 barrels per day.

The deal also helped Bangchak expand its network of petrol stations to some 800 locations across Thailand, with the company aiming to further expand the network to around 2,200 locations and increase its refinery capacity to 294,000 barrels per day.

Bangchak To Purchase Remaining Shares This Year

Embarking on an ambitious journey to becoming Thailand’s largest oil refinery company, Bangchak will now be supplying its world-class products – billed as eco-friendly and recipients of quality certifications from the Department of Energy Business – to the acquired Esso stations.

Chaiwat Kovavisarach, Group CEO and President of Bangchak, announced completion of the 22.6 billion baht acquisition of Esso Thailand’s ordinary shares. Esso’s decades-long operations in the country were brought to an end, with its network of petrol stations undergoing rebranding.

While the completed acquisition comprised 2.28 billion shares of Esso Thailand, Bangchak is now set to purchase the remaining 34.01% or 1.17 billion shares – worth 11.65 billion baht – with the payment scheduled to be made in October this year.

“Through A New Company” To Be Established

A Reuters report dated January 12 carried ExxonMobil’s decision to sell its two-thirds stake in Esso to Thailand-based Bangchak, in a deal valued at about 20.1 billion baht at the time. After the companies made the announcement, Bangchak’s shares closed up 9%, while Esso fell 17%.

Nevertheless, “the final price will be based on Esso Thailand’s latest quarterly earnings after conditions are finalised,” Chaiwat Kovavisarach at Bangchak had told a news conference. The sale includes the Sriracha oil refinery, select distribution terminals and former Esso stations.

Following the purchase announcement in January, ExxonMobil’s shares traded up about 1%. The oil and gas corporation had said it would continue to deliver branded finished lubricants and chemical products to Thailand “through a new company” to be established.