News Detail

Date/Time
03 Apr 2015 19:32:00
Headline
The Notification of the Decision to Refrain from Exercising of the Rights to Invest
Symbol
ERWPF
Source
ERWPF
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                Jortor 11-580192                                      April 3, 2015

To:     The President
             The Stock Exchange of Thailand

Re:     The Notification of the Decision to Refrain from Exercising of the Rights 
to Invest in Ibis Huahin and/or Ibis Kata that were offered by the Erawan Group
Public Company Limited

SCB Asset Management Co., Ltd., the Management Company ("the Management 
Company") of Erawan Hotel Growth Property Fund ("the Fund") would like to notify
that it has decided to refrain from exercising the Rights to Invest in Ibis
Huahin and/or Ibis Kata that were offered by the Erawan Group Public Company
Limited ("ERAWAN") as summarized below:
Due to ERAWAN offered the sale of Ibis Huahin and/or Ibis Kata ("the Offering 
Properties") to the Fund, in accordance with the Undertaking Agreement between
ERAWAN and the Fund dated on March 27, 2013 ("the Undertaking Agreement").
According to the term that was specified in the Undertaking Agreement, the Fund 
needs to get an approval from the Unitholders within 60 days from the date that
the Fund received an offering letter from ERAWAN, which was on February 20,
2015. However, section 58 of the Announcement of the Office of the Securities
and Exchange Commission (the "Office of the SEC") No. SorNor. 25/2556 re: Rules,
Conditions and Procedure of the Establishment and Management of Property Fund,
amended by the Announcement of the Office of the SEC No. SorNor. 40/2556 re:
Rules, Conditions and Procedure of the Establishment and Management of Property
Fund (9th edition) requires that the Management Company must submit the filing
to the Office of the SEC to seek an approval of the capital increase in order to
make additional investment in real properties or leasehold rights to real
properties within December 31, 2013. Given this requirement, the only way for
the Fund to invest in the Offering Properties is to get an approval from the
Unitholders to convert itself from Property Fund into Real Estate Investment
Trust ("REIT") before making an investment in the Offering Properties.
In addition, the Fund also needs to act in accordance with the Announcement of 
the Capital Market Supervisory Board No. TorChor. 50/2556 re: the Conversion of
Property Fund into Real Estate Investment Trust ("Announcement TorChor.
50/2556"). The involved processes that the Fund needs to follow in order to make
an additional investment according to related announcements/guidelines shall
take longer than 60 days.
Due to the timing limitations explained above, the Management Company already 
put its best efforts to protect the highest interest of the Unitholders by
negotiating and sending the letter to ERAWAN to request for the extension of the
exercising period to give the Fund sufficient time to take necessary actions to
properly make an additional investment in such Offering Properties. Such
actions include the arrangement for an approval from the Unitholders re:
conversion into REIT and the capital Increase and the arrangement for an
approval from the Office of the SEC, and etc.
However, ERAWAN had considered the request and given a response to the 
Management Company that the timeframe specified in the Undertaking Agreement
might be for the highest interest to ERAWAN's shareholders in terms of the
return from selling the Offering Properties that ERAWAN's shareholders shall
receive and the mitigation of the risk arisen from the market volatility which
is an external factor uncontrolled by ERAWAN. In addition, the extended
exercising period requested by the Fund is substantially longer than the period
previously agreed in the Undertaking Agreement. For these reasons, ERAWAN denied
 the request for the extension of exercising period by the Management Company.
Thus, the Fund needs to refrain from exercising the Rights to Invest in Ibis 
Huahin and/or Ibis Kata that were offered by ERAWAN. However, the Fund's Rights
to Invest in any Ibis hotels owned by ERAWAN that are located in Thailand shall
continue under the Undertaking Agreement until March 31, 2018 as the Fund has
such right for 5 years from the date that ERAWAN registered the ownership
transfer of Ibis Patong and/or Ibis Pattaya to the Fund.

Under the Undertaking Agreement, ERAWAN cannot enter into a transaction with any
parties in the same or better terms and conditions compared to those that
ERAWAN offered to the Fund for the Offering Properties within 150 days after the
date that the Fund denies to exercise its Right to Invest or the date that the
Fund is unable to enter into such transaction. Such no-better-offer period will
end on July 19, 2015.

Please be informed accordingly.

Yours faithfully,
Erawan Hotel Growth Property Fund
By SCB Asset Management Company Limited


(Mrs. Tipaphan Puttarawigorm)
Senior Vice President, Property and Infrastructure Investment Group
______________________________________________________________________
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of the information and related documents of listed company or issuer to the
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