Siam Commercial Bank Abandons Planned Purchase of BitKub

Thailand’s leading universal Bank, the Siam Commercial Bank (SCB), has announced it is terminating its proposed $500 million deal to acquire crypto exchange firm Bitkub.

According to the press release, Bitkub is resolving some issues as per the recommendations of the Securities and Exchange Commission (SEC) of Thailand. The uncertainty as regards the timeline for resolving these issues necessitated the cancellation.

The proposed acquisition was first announced in November 2021. At the time, Siam had agreed to acquire a 51% stake in Bitkub at an approximate price of $536 million. The acquisition would have made it the highest shareholder in the exchange firm.

After the announcement of the proposed acquisition, Siam proceeded with a due diligence exercise on Bitkub.

The exercise did not reveal any “irredeemable abnormal issues” about Bitkub. But for the lack of a definite timeline for fixing regulatory issues, the deal had to be canceled effective immediately. The decision to cancel the deal was the resolve of its board of directors and was agreed to by both parties.

BitKub’s Issue With Regulators

Speaking on the termination, Bitkub said its operations were not affected and it needed the time to satisfy some conditions of the regulators. For Bitkub, the partnership was supposed to take its operations to a global scale.

The SEC had earlier judged that the KUB coin was not eligible for trade on any cryptocurrency platform. Therefore it ordered Bitkub to review the selection and listing process of the native token. The regulator had given the exchange up until July 31 to complete the listing process according to a local media report.

While SCB’s deal with Bitkub has hit the rocks, several banks including Bank of Ayudhya Plc have made similar moves. Last year, the Bank of Ayudhya participated in a $41 million fundraising, for now, troubled exchange, Zipmex.

Although its deal with Bitkub is effectively terminated, the company will still pursue its plans of expanding into the blockchain-related technology business in hopes of developing digital assets in Thailand.

SCB had considered the acquisition because of the significant leap of businesses in the sector over the years and potential growth value in the future. It hoped to shape and develop the digital asset space in Thailand with the acquisition.