A woman leaves a Makro store, operated by Siam Makro Pcl, in Bangkok, Thailand, on Tuesday, April ... [+]
CP Axtra—the retail arm of billionaire Dhanin Chearavanont and his family’s Charoen Pokphand Group—will merge with CP Group’s Ek-Chai Distribution as Thailand’s biggest conglomerate reorganizes its retail businesses to simplify the group’s structure and support future growth opportunities.
Under the plan, CP Axtra will assume direct ownership of Ek-Chai Distribution, operator of Lotus’s Thailand retail chain, for 7.7 billion baht ($215 million), the company said in a regulatory filing on Wednesday.
The combination of CP Axtra’s over 160 Makro stores across nine countries with the more than 2,500 Lotus’s locations in Thailand and Malaysia is expected to boost the group’s operating efficiencies.
“Once completed, the move should enhance efficiency, business flexibility, and generate some kind of synergies for the group,” said Rakpong Chaisuparakul, strategist at KGI Securities (Thailand). However, “it will require some time to implement this business restructuring and I don’t expect any substantial benefit or synergy being materialized in the short run.”
As part of the restructuring plan, CP Axtra will merge with Ek-Chai into a new company that will eventually replace CP Axtra’s listing status on the Thai bourse. Upon completion of the merger by the fourth quarter of this year, the holding firm Lotus’s Stores (Thailand), which currently owns Ek-Chai Distribution, would be dissolved. CP Axtra’s parent, CP All, is the largest convenience store operator in Thailand.
CP Group—one of the world’s largest producers of animal feed and livestock—was founded by Dhanin’s late father Chia Ek Chor and his brother Choncharoen Chiaravanont in 1921 as a shop selling seeds imported from China to Thai farmers. With a net worth of $34 billion, Dhanin and his brothers are the richest in Thailand.
Dhanin—who received the Malcolm S. Forbes Lifetime Achievement Award at the Forbes Global CEO Conference in September 2023—was chairman of the company for 48 years until he stepped down in 2017. His eldest son, Soopakij, and the youngest, Suphachai, are CP's chairman and CEO, respectively. The company has diversified over the years into new businesses such as retail, telecommunication, finance, pharmaceuticals, property, auto and e-commerce. It also has stakes in Chinese insurer Ping An, Hong Kong conglomerate CITIC and Thailand’s largest mobile phone operator True Corp.
