28 Feb 07
Boonklee Plangsiri, considered the right-hand man of Shin Corp founder and ousted premier Thaksin Shinawatra, has stepped down as the chairman of iTV as the company faces an unpredictable future.
The troubled broadcaster is currently facing possible bankruptcy from state fines of up to 100 billion baht for alleged concession violations.
Niwattumrong Boonsongpaisan, a director of iTV Plc said yesterday that the board had approved the resignations of Mr Boonklee and Weerawong Chittmittrapap, a director and the member of the audit committee.
Anan Leetrakul has been named chairman of the board and of the audit committee, effective immediately.
The board also approved the omission of a dividends for fiscal 2006, citing its accumulated loss.
iTV posted a net loss of 1.78 billion baht last year against a net profit of 679 million in 2005. Revenue last year declined by 7.9% to 2.16 billion baht.
The company attributed the revenue decrease mainly to intensified competition for television advertising, the uncertain political environment and general economic slowdown.
As well, since mid-2006 the company has been affected by uncertainty about its programming schedule, which has caused some clients to delay advertising purchase decisions.
The company reported its concession fee for 2006 at 2.506 billion baht, a significant increase from 230 million in 2005, reflecting the accrued differences in concession fees payable for the period from 2004 to 2006 plus interest.
The actions were taken in accordance with a Supreme Administrative Court ruling on Dec 13, 2006. It upheld a Central Administrative Court revocation of an arbitration award dated Jan 30, 2004.
In addition to being liable for higher concession fees, iTV has been ordered to restore its ratio of news to entertainment programming to 70:30, in line with the terms of its original concession from the Prime Minister’s Office, from 50:50.
The company is facing difficulty securing the funding to repay the difference in the unpaid concession fee totalling 2.21 billion baht plus interest of 15% per year. On Jan 4 it submitted a case contesting the amount to an arbitration panel but no ruling has been made yet.
M.R. Pridiyathorn Devakula, the finance minister and deputy prime minister, said the cabinet would consider iTV’s proposal to repay debts when it meets today.
iTV has proposed five options: installment payments; converting debts to equity to be acquired by the PM’s Office; finding private companies to acquire Shin Corp’s stake; making a partial repayment and repaying the rest with equity; or returning the TV concession.
ITV shares closed yesterday on the Stock Exchange of Thailand at 0.94 baht, up one satang, in trade worth 3.91 million baht.
Shin Corp profits in dramatic 2006 drop
28 Feb 07
Shin Corp PLC – Thailand’s largest telecommunications conglomerate, which was bought out by Singapore’s Temasek Holdings in a controversial deal last year – said Tuesday that its earnings plunged 60 per cent in 2006.
Its profit was 3.4 billion baht (94.4 million dollars) last year, down from 8.6 billion baht in 2005, Shin Corp said in a filing with the Stock Exchange of Thailand.
Stock brokers said the dramatic drop in profits was mainly because of losses accrued by Shin Satellite and a decline in the profitability of Advanced Info Service, a mobile-phone service that previously accounted for more than 90 per cent of the conglomerate’s profits.
iTV, another Shin Corp company, is on the verge of bankruptcy.
Temasek, the Singapore government’s investment arm, bought a 49-per-cent stake in Shin Corp in January 2006 from the family of former Thai prime minister Thaksin Shinawatra.
The purchase, a 1.9-billion-dollar, tax-free transaction for the Shinwatara family, proved a controversial one.
Shin Corp, founded by Thaksin, is a holding company with controlling stakes in Advanced Info Service, Thailand’s largest mobile-phone network; Shin Satellite, Thailand’s only satellite network; iTV, a television station; and AirAsia Thai, a budget air carrier.
The sale prompted anti-Thaksin protests for selling off what were deemed national assets and created anti-Singapore sentiments in Thailand for allowing Temasek to buy them.
Thaksin was eventually overthrown in a September coup. General Sonthi Boonyaratkalin, the leader of the junta that ousted Thaksin, earlier this month expressed his wish to repurchase ShinSat, if not the entire Shin Corp, which he said he viewed as national assets.