Try the new FT.com

February 17, 2007 12:30 am

Thai coup leader wants ShinCorp back

  • Share
  • Print
  • Clip
  • Gift Article
  • Comments

Shares in Thailand’s giant Shin Corp group slid on Friday after the leader of last year’s military coup said he wanted to find a way to reverse Singapore’s $3.8bn purchase of the telecoms group.

Sonthi Boonyaratkalin, army chief, stopped short of explicitly threatening to nationalise the conglomerate founded by Thaksin Shinawatra, the ousted prime minister, but insisted it should be Thai-owned.

“I want the nation’s belongings back, especially the satellites,” said Gen Sonthi, who has repeatedly accused Singapore of using Shin Corp’s telecommunications satellites to spy on the Thai army.

Gen Sonthi, leader of the military junta that installed the administration, said he had not figured out yet how to return Shin Corp, now owned by Singapore’s Temasek Holdings, to Thai hands. But he insisted it was his duty to “salvage the country and its assets”. “National assets, no matter where they are located, always belong to Thailand and the Thai people,” he said.

The comments sent shares in Advance Info Systems – Thailand’s largest mobile phone operator and a Shin Corp subsidiary – plunging more than 6 per cent on Friday, while shares in Shin Corp dropped 2.6 per cent.

Temasek, the Singapore government’s investment arm, and Singapore’s foreign ministry refused to comment.

Temasek’s takeover of Shin Corp – and the Shinawatra family’s $1.9bn (€1.4bn, £970m) tax-free profit from the deal – triggered mass protests in Bangkok in January last year and a long-running political crisis that culminated in the bloodless military coup that ousted Mr Thaksin in September. However, analysts did not believe the current administration would try to nationalise the group.

“I don’t think the Thai government would take that step – it would be disastrous for this country in terms of foreign investment,” said Vincent Milton of Fitch Ratings Thailand. “But it is so unpredictable. There is such a high-level of uncertainty in policy-making.”

The comments are likely to unsettle further Thailand’s already jittery foreign investment community, who feel the current administration’s economic policies – including the imposition of capital controls and revisions to foreign investment laws – reflect a growing xenophobic streak.

Thai law limits foreign participation in telecoms companies to just 49 per cent, but Temasek – as well as other companies such as Norway’s Telenor – have used complex multi-level shareholding structures to exceed that.

Copyright The Financial Times Limited 2017. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.

  • Share
  • Print
  • Clip
  • Gift Article
  • Comments

NEWS BY EMAIL

Sign up for email briefings to stay up to date on topics you are interested in

SHARE THIS QUOTE