Memories Group buys out Samena Capital-backed Myanmar firms for $41m — Deal Street Asia

By Juliet Shwe Gaung

SGX-listed Memories Group – which operates tourism businesses in Myanmar – has completed the acquisition of SM Asset Holdings Pte Ltd and Mokan (S) Pte Ltd, that own islands and hotels in the country, for $40.7 million, according to an SGX announcement. A spin-off of Mainboard-listed Yoma Strategic Holdings’ tourism business, Memories Group has acquired 100 percent stake in SM Asset Holdings and the remaining 20 percent interest in Mokan (S) Pte Ltd, which is 80 percent owned by SM Asset Holdings. The deal was completed on October 26. Private equity firm Samena Capital had invested $19 million in SM Asset Holdings in 2017 through its Samena Special Situations Fund III L.P. It was Samena Capital’s first private equity investment in Myanmar.

“The unique positioning of the Islands, together with the two well-located properties will broaden our hotel offering and further enhance our integrated tourism platform,” said Serge Pun, executive chairman of Memories Group in an announcement in July. Following the completion of the proposed acquisitions, 141 million consideration shares will be allotted and issued at the price of S$0.25 per share to Samena Mandalay Holdings; and 5.4 million shares will be issued to the Mokan Vendor, Pyai Phyo Tun.

According to a previous announcement, both cash and issuance of shares will fund the payment. The two companies will become subsidiaries of Memories Group. At the same time, the group will also gain the development rights of Bo Ywe Island, Nga Mann Island and Kyun Pila Island in the Mergui Archipelago, about 90 km from Kawthaung, Tanintharyi region plus Awei Pila, a five-star beachfront resort on Kyun Pila Island, which is scheduled to open by the end of 2018. The acquisition also includes Hotel Suggati, a three-star asset in Mawlamyaing, Mon state, also scheduled for an opening by the end of 2018. The completion of the deal comes three months after the group announced the proposed acquisition. The Islands provide a usable land area of 100 acres and a further 550 acres reserved for future development.

The development rights also allow the group to supervise over 4,450-acres of environmentally protected land which the company said may be utilized to create eco-friendly activities as part of the tourism-related business. Memories Group is the first Myanmar tourism-focused company to be listed on an Exchange board and its tourism business includes Balloons over Bagan, Bagan Land, a commercial and hospitality development, Hpa-an Lodge and Pun Hlaing Lodge businesses among others.