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TIDLOR Announces Organizational Restructuring to Holdings Company, Establishes New InsurTech Platform Company to Foster Long-Term Growth

The board of directors meeting of Ngern Tid Lor Public Company Limited (“TIDLOR” or “Company”), on April 30, 2024, resolved to propose that the shareholders’ meeting consider and approve the Company’s shareholding and management restructuring plan and other related matters by establishing a holdings company under the name Tidlor Holdings Public Company Limited (Tidlor Holdings). The objective is to enhance operational flexibility in both the lending and insurance brokerage businesses, increase competitive advantages, and expand opportunities into related businesses. Additionally, it will create more opportunities for strategic partnerships through M&A and joint investments, significantly bolstering the strength of the group. This restructuring will also enable more efficient management and risk limitation across different business units. Moreover, the company plans to establish a new company (NewCo) under Tidlor Holdings to improve flexibility in strategy formulation, management, and operations related to non-life InsurTech insurance brokerage business (InsurTech Platform). This restructuring plan represents a strategic realignment to facilitate long-term growth.

The company's insurance brokerage business under the brand "Shield Insurance" has become the number one provider of face-to-face consultation and sales, boasting a team of over 5,000 experts delivering services through more than 1,700 branches nationwide. Additionally, the introduction of the online insurance marketplace platform (Areegator) has empowered independent brokers with access to professional sales management systems, while the online insurance brokerage platform (heygoody) has been developed to cater to the comparison and selection of insurance online for individual customers, eliminating the need for telesales. The sustained success of insurance brokerage business is built on more than a decade of continuous investment, development and implementation of insurance technology. This dedication has established a solid foundation for the insurance brokerage operations and also ensure ongoing enhancement to support and drive our business activities, both now and into the future

FAQ

This transaction is a holding company restructuring of TIDLOR, for which there are many precedent cases in the market.

The process is to set up Tidlor Holdings to tender all TIDLOR's existing shares via share swap (Tender Offer) with a swap ratio of 1 ordinary share of the Company to 1 new ordinary share of Tidlor Holdings. After the Tender Offer is completed, Tidlor Holdings will be listed on the SET in replacement of the Company’s listed securities which will be delisted on the same day.

Moreover, TIDLOR will transfer its non-life InsurTech insurance brokerage business (InsurTech Platform) to a newly set up company (NewCo). After completion of the transfer of the non-life InsurTech insurance brokerage business, Tidlor Holdings will acquire 99.99% of the shares in the newly formed company to segregate the new business, which operates differently from TIDLOR

The restructuring will help create "Operational efficiency" in the Group including;

  1. To allow TIDLOR to segregate businesses with different natures
  2. To manage and utilize resources and expertise in economies of scale manner in the best interests of the Group
  3. To strengthen the business opportunity with specialized management
  4. To increase flexibility in expanding business to ensure readiness to seize future opportunities.
  5. To enhance the efficiency of risk management in asset protection for each business by clearly segregating governance and risk management, enabling the limitation of risks and operational impacts from investments in other businesses under different subsidiaries of Tidlor Holdings
  6. To create opportunities to reduce the tax burden on shareholders due to the distribution of stock dividend

Furthermore, the company's restructuring also helps reflect the true potential of operations, allowing for a more distinct comparison with industry performance and increasing the potential to enhance value within the group of companies.

This restructuring plan will be one of the resolutions at an Extraordinary General Meeting (EGM) on June 11, 2024. Following that, it will proceed to the process of seeking approval from the relevant regulatory authorities.

It is expected that Form 69/247-1 (Securities Offering Document with Securities Purchase Offer) will be submitted within Quarter 3 of the year 2024. The processes of tender, listing/delisting, and selling InsurTech business to new company are anticipated to be completed within Quarter 4 of the year 2024.

If TIDLOR's shareholders complete a 100% share swap, every TIDLOR shareholder will have the same proportion of Tidlor Holdings shares as their previous TIDLOR shareholding ratio.

However, there is a possibility that approximately 1-2% of minority shareholders may not accept the tender offer, which could result in minor adjustments to the shareholding structure (based on past instances of similar restructuring). Nevertheless, the company intends to purchase as many shares as possible from these minority shareholders.

Tidlor Holdings acts solely as a shareholder in other subsidiaries and does not conduct its business operations. It functions as an investment and capital allocation unit within the group, overseeing the overall structure and policies to enhance flexibility and potential for future business expansion.

Ngern Tid Lor PCL (TIDLOR) will continue to focus on the lending business, vehicle title loan under the Ngern Tid Lor brand, and the insurance brokerage business through branch channels under the Shield Insurance brand. There will be no significant changes in the core business, strategy, and operations.

New company (NewCo): After establishing and acquiring a non-life Insurtech insurance brokerage business from TIDLOR, NewCo aims to enhance flexibility in strategy formulation, management, and business-related non-life InsurTech insurance brokerage business (InsurTech Platform).

InsurTech applies technologies to enhance efficiency in the sales and service processes within the non-life insurance brokerage sector, thereby elevating customer experiences. This includes simplifying complex document issuance processes for clients, addressing limitations in payment systems, and streamlines backend and post-sales processes.

Our technology reduces work time and minimizes the risk of errors in various processes, leading to improved customer satisfaction and retention. Previously, TIDLOR has leveraged its technological infrastructure to grow its non-life insurance brokerage business. Consequently, the Company identify further opportunities to expand this business through the InsurTech platform, utilizing Areegator platform and heygoody.

While the future is uncertain, the current focus is on the restructuring plan, including the spin-off of the non-life Insurtech insurance brokerage business. Furthermore, the company will assuredly inform investors about any future business opportunities that may emerge. The company remains confident that the resources and structure of our corporate group will provide the flexibility needed to adapt to potential future opportunities.

  1. 1 ordinary share of the Company to 1 new ordinary share of Tidlor Holdings
  2. The share swapping period will be started after the SEC Office approves the share offering
  3. The share swap period (for at least 25 business days, but not exceeding 45 business days) is expected to take place in the second half of the year 2024
  4. The details of the Tender Offer will be disclosed in the tender offer documents which will be a part of form 69/247-1

This will occur after the completion of the tender offer process which will be tentatively in Quarter 4 of the year 2024.

Accepting the tender offer for securities

  • Accepting the tender offer will result in TIDLOR shareholders becoming shareholders of Tidlor Holdings, an investment holding company overseeing TIDLOR and other subsidiaries. Shareholders won't face tax liabilities from the share swap, as it is a restructuring, and the Revenue Department allows using the cost price for juristic persons.
  • For calculating corporate income tax from the future sale of Tidlor Holdings shares, the original purchase price will serve as the tax base.

Failure to accept the tender offer for securities

  • Inability to trade TIDLOR's securities on the SET as TIDLOR will be delisted, leading to a lack of liquidity and no reference market price.
  • Limited investment returns with reduced chances of capital gains, relying mainly on dividends.
  • Exclusion from benefits associated with operations of subsidiaries and Tidlor Holdings.
  • Exposure to capital gain tax and stamp duty upon selling shares or transferring share ownership.
  • Limited access to news and information as TIDLOR is no longer listed.
  • Potential exemption from certain disclosure requirements if minority shareholders fall below 5% or are less than 100 in number.
  • Tidlor Holdings holds over 75% of voting rights, granting them significant control over important company decisions without requiring broader shareholder approval.

The existing TIDLOR shareholders will be offered the Tender Offer (share swap). Additional details will be included in the registration statement for securities offering together with the Tender Offer for the securities (Form 69/247-1)