THAI needs to raise 10 billion baht as part of its restructuring plan
Thailand’s State Enterprise Policy Office (SEPO) announced Thai Airways (THAI) needs to raise 10 billion baht to ensure the company’s shareholding does not dip below 40%.
The Finance Ministry, THAI’s biggest shareholder with a 47% stake, revealed plans are already underway to raise the finances and preserve its shareholding in the company.
SEPO Director General Pantip Sripimol reported that the ministry is selling some of its shares in other state enterprises to raise the necessary funds. Pantip added that the Finance Ministry has not revealed which state industries will be sacrificed as part of the deal as the decision will be made by the ministry’s policymakers.
The Finance Ministry made known recapitalisation money will not come out of the central budget coffers that the government allocates to the ministry.
THAI received a much-needed boost last week when the Central Bankruptcy Court approved the airline’s request to overhaul its recovery plan.
Thailand’s national flag carrier was told by the court to carry on after most of its creditors backed the revised plan. About 79% of the creditors, including the Finance Ministry, endorsed THAI’s revised recovery plan.
THAI has struggled over the past few years like most businesses on the back of the Covid-19 pandemic.
The airline filed for bankruptcy protection in late 2019 after reporting massive debts of 245 billion baht. In May 2020, the Cabinet gave the rehabilitation plan the go-ahead under the Bankruptcy Act, which was later approved by the Central Bankruptcy Court. But green shoots of recovery have sprouted over the past few months.
THAI reported positive feedback since international travel resumed with the easing of the pandemic. They also made known they would pay refunds to customers whose flights were cancelled because of the pandemic.
Pantip said the SEPO backs the sale of the Finance Ministry’s shares in non-listed businesses. Most of those shares were gained from acquiring foreclosed assets.
