The Bangkok Metropolitan Administration's plan to finance the extension of the BTS SkyTrain, announced earlier this week by Governor Apirak Kosayodhin, is a publicity stunt designed to win votes for the Democrats in the July 23 city council elections, Thai Rak Thai councilor Chaiwut Jariyavirojsakul said yesterday...
Skytrain extension work to start in '07 - The Nation, April 29, 2006
Apirak's plan for skytrain under fire - Bangkok Post, April 27, 2006
[It is back to normal for city politics...]
Bangkok Governor Apirak Kosayodhin's decision to switch the budget for the 16 megaprojects, stalled following graft charges, to the skytrain route extension came under political fire yesterday. Visut Samretwanich, Thai Rak Thai councillor for Lat Krabang district, claimed the switch was aimed at helping Democrat candidates running in the district council election on April 30...
Chaiwut Jariyavirojsakul, Thai Rak Thai councillor for Bang Kapi, said the decision to suspend the 16 flyover projects was detrimental to public well-being and he would gather 50,000 signatures to call for Mr Apirak's impeachment.
Meanwhile, Thai Rak Thai deputy leader Pokin Polakul said he will file a libel suit against Democrat deputy leader Alongkorn Ponlabutr tomorrow after he accused him of being involved in the tainted 6.7 billion baht project to procure 315 fire trucks and accessories for the city...
Skytrain routes! - translated and summarized from Matichon, April 24, 2006
1) Taksin Extension Phase 2 (Taksin extension - Phetkasem -> 4.5 km)
BMA to foot bill for line extension - The Nation, April 24, 2006
The Bangkok Metropolitan Administration (BMA) will spend Bt9 billion of its own money to build the 5.2-kilometre extension of the Skytrain from Onnuj to Bang Na...
Deputy Bangkok Governor Panich Vikitsret said the extension had been delayed for a long time because of a decision in 2000 by the Cabinet to require the project to be 100-per-cent funded by the private sector. The BMA had petitioned the government to have the resolution changed to allow the BMA to join in the investment.
"It would be better for the BMA to invest in the construction of the 5.2km extension from Onnuj to Sukhumvit Soi 107, which is part of the 8.9km Onnuj-Samrong route project," Panich said...
BTS dilemma - Deutsche Bank selling debt to New World - Khiri lobbying Pheng for Phaholyothin Extension - Pheng refusing to meet with Khiree - translated and summarized from Post Today, January 18, 2006
Deutsche Bank has promptly sold US$850 million of debt purchased from KfW to 4-5 Asian investors - without any local Thai investors to get selling fees and the New World group and Samsung Life Insurance (Thailand) are the main buyers since Samsung Life and New World Group of Hong Kong are alliances of Mr. Khiree.
SCB has sold BTS shares to ADB subsidiary at 6 billion baht while IFCT (now a part of TMB) has sold BTS stocks to American Engineering Firm at 2.680 billion while KfW has sold the stock at 70-72% of the nominated stock price. Much higher than 50% of the nominal stock prices offered by Minister Suriya.
Mr. Super K said he still work with Mr. Khiree despite of the threat of litigation. The upcoming meeting on January 18 would be the decision to force Mr. Super K. to resign as the Chairman of BTS board not the dismissal of the entire BTS board.
Mr. Prakit Pratheepasen (member of the BTS board) said he and Mr. Saranthorn Chutima (the assistant manager of the marketing department from SCB) would have to resign since the new creditor has already nominated the new man to replace him and his friend.
The 39 billion baht outstanding debt of BTS consists of 33 billion baht in principle and 6.3 billion baht interest. The shareholders said they want to write off 8.5 billion baht in debt--2.2 billion baht in principle and outstanding interest of 6.3 billion baht while converting 12 billion baht debt into assets.
Mr. Khiri and BTS shareholders are trying to lobby with Minister Pheng to deal with the debts and get the right to handle the
1) Phaholyothin extension
2) Phran Nok extension
3) Samrong-Paknam extension
4) Taksin extension phase 2
However, Minister Pheng refuses to meet them since he did not want to interfere in the internal affairs unless it is at his own advantage. Only after the final settlement of BTS debts between the shareholders, creditors, BTS Board and Mr. Khiree.
Furthermore, Minister Pheng would like to call a free bid which he may not invite BTSC and BMCL to get into the bidding since both have already have the cutting edges due to ready depots and existing rolling stocks. MOTC would invite BTS and BMCL only after they accept the new TOR which will be approved on January 26, 2006.
Note: It seems to me that Minister Pheng would not allow BTS to run Phaholyothin extension unless Mr. Khiree agrees to surrender BTS stock to Shin Corp and the leader's cronies at bargain prices.
This is due to the fact that Phaholyothin Extension would hurt the sale of Shinnicha Villages along the Red Line Commuter. Without Phaholyothin extension, people would force people who live along Phaholyothin to migrate to live at the Red Line commuter, pleasing Shinnicha (real estate arm of Shin Corp). Phaholyothin extension in Shin Corp Portfolio would definitely double the assets without doubt.
The Taksin extension (both phase 1-2) would hurt Blue Ring while Samrong-Paknam extension would hurt the Yellow LRT.
Furthermore, Phran Nok extension through Rattnakosin Island is so lucrative that Transport Minister Pheng would not approve the construction of this line unless the leader [Thaksin] and his cronies have obtained this line for themselves. However, the selling of the BTS debt at 70-72% of the price has shocked Transport Minister Pheng and the TRT cronies since they have to pay a much higher price to get BTS debts before converting debt into equity.
Super K [Kasem Jatikawanit, the Chairman of BTSC Board of Directors] said the upcoming special meeting session of shareholders on February 16 is due to the request from the main shareholders (Thanayong, New World, Samsung Life) to overturn the old debt restructure plan and make a major change on the BTS board. Super K. agrees on the change of debt restructure plan even though the main shareholders refuse to elaborate the details of the new plan.
For the change of the BTS Board, Super K said he did call a meeting on December 8, 2005 to all 16 members of the BTS board, but he has only three--not enough for a quorum. This incident has outraged Mr. Khiree so he has filed a case against Super K for neglect of duty in the civil court. The hearing would be held at civil court on January 19, 2006.
However, Super K told the press that Khiree is scheming to kick him out of the position of BTS board chairman with three reasons, including:
1) Mr. Khiree and company have never collateralized the debts through registration as asked by Super K due to the request from the creditors.
2) The registrar has not make any registration on the stock transfer from Thanayong to ADM (subsidiary of ADB) and ADM has sent the letter to the BTS board that ADM has transferred the stocks to CTF, subsidiary of New World group.
3) BTS has not paid the outstanding fees to Mr. Bill Repper, the financial adviser approved by the BTS Board.
It would be very regretful that there is no progress on debt restructure even though the BTS board has worked so hard and spent lots of time and energy to deal with the matter. Therefore, Super K. said Mr. Khiree should listen and follow the advice from the BTS board to save the company from worsening troubles.
Super K refuses to resign until he receives the resolution from shareholders to sack him. Super K has pointed out that the actual share holding allocation for Thanayong is just 8.8%, not 28.21% (from the initial 50%) as claimed by Mr. Khiree since Mr. Khiree has not registered the transfer of capital to the registrar. On the other hand, New World Group has held 26.26% of stock while ADM (ADB subsidiary) has held 23.03% of stock after purchasing the stock from Credit First Boston (Hong Kong). ITD is going to sell all the remaining stocks to ADM.
Mr. Khiree said he could not accept the old debt restructure plan of Super K and BTS board since it deters BTS from offering an IPO and paying the dividend to shareholders who has held the stocks for about 10 years. Therefore, Mr. Suiper had to step down from BTS board Chairman if the resolution from the upcoming special meeting session of shareholders on February 16 said Mr. Super K. has to resign.
The debt restructure plan of BTS Board is to clear 40-50 billion baht of debt to 27 billion baht--all to be paid in 18 years.
1) Haircut the outstanding interest up to the end of 2004 by 6.3 billion baht
2) 2.2 billion baht cutting of principle
3) Converting 4.3 billion baht of debt into equity
All the revenue is to be paid off in debt. No dividend payment, so the main shareholders refuse to accept this plan. Therefore, the BTS board are asking to shorten the debt payment period from 18 years to 13 years which the shareholders cannot accept either since it requires higher principle payment. Therefore, BTSC shareholders said they cannot accept the BTS board debt restructure plan by Super K--and Super K points out the debt delinquency for Mr. Khiree and shareholders. So, the main shareholders have no choice but to force Super K to step down as the chairman of BTS board by voting.
Mr. Khiree also discusses with members of the BTS board such as Mr. Phanat Simasathian and Siwawongse Jankhasiri about this new debt restructure plan and the change of BTS board chairman. Both members of the BTS Board warned Mr. Khiree that he and his friends would have to take full responsibility if the new plan from Mr. Khiree failed even though they are very reluctant to sack Super K. due to their respect for him. However Mr. Khiree has to sack Super K despite his veneration since Mr. Khiree has no choice due to the stubbornness of Super K.
The new debt restructure would take 12 months to be complete due the cooperation of the new creditors and shareholder, but shareholders would have to appoint the new chairman of the BTS board and participate in the debt restructure plan to ensure that the main shareholders could offer IPO and pay the dividend along with the major extensions.
The 451.5 million US dollar debt held by KfW has been officially transferred to Deutsche Bank AG (LONDON) and Fifth Avenue Capital group (New York).
The 80 million US dollar debt held by IFC [subsidiary of World Bank] has been transferred to Fifth Avenue Capital group (New York).
The 1.5 billion baht of IFCT (now TMB) has already transferred to Deutsche Bank AG (London).
SCB still holds 3.2 billion baht of BTS debt while Thanachart Asset Management Co. Ltd. has held 2.1 billion baht of BTS debt TAMC has held 3.85 billion baht of debt and SICCO has held 0.5 billion baht of debt without official announcement of debt transfers yet.
Mr. Khiree has responded to the accusation that Thanayong has held 8.8% of stocks that he can make a transfer of stock to pay off the debt to creditors such as New World and Credit First Boston (Hong Kong) if he wants to but only after the stock price assessment. The debt restructure has caused the delays on stock transfer to the creditors. Furthermore Thanayong could pay back the creditors in cash instead of stocks in the future. Furthermore, Thyanayong and New World Group are in strategic alliance so the stocks transfer is not a problem after all, so long that Thanayong is the nominal major shareholders and it is not the business of anyone to ask him to do anything they please.
Internal rift within BTS - Khiri vs. Kasem - translated and summarized from Prachachart Thurakij, January 12-15, 2006
There are internal conflicts between Mr. Khiri Kanchanaphak (the owner of BTS) and Mr. Kasem jatikawanit (the Head of BTS Board) on many issues such as
1) The ways to run the company
2) The selling of BTS stock to the government - Mr. Khiri is willing to sell BTS stock at 5 baht/share - well below the par price of 10 baht/share as the way to get a long term deal with the connection for other routes. This is instead of 15 baht/share according Mr. Kasem's plan to extract the most from the government's coffer. This plan is due to the fact that Mr. Kasem is a staunch supporter of the Democrats, so animosity toward the TRT government is not a surprise at all.
3) The debt restructure plans. The old plan proposed by Mr. Khiri has folded since the creditors refuse to approve the debt restructure deal despite the approval from both shareholders and the BTS Board. Therefore, creditors have sold debts of BTS to the following companies as the sign of disapproval of the BTS debt restructure plan:
3.1) SCB sold 6 billion baht of BTS debts to a subsidiary of ADB
3.2) KfW sold 34 billion baht of BTS debts to Deutsche Bank
3.3) IFCT has sold 2.68 billion baht of BTS debts to contractors from the U.S.
This effectively forces BTS to go back to square one for debt restructure.
Mr. Khiri is satisfied with the new creditors who purchase BTS debt, but Mr. Kasem is urging Mr. Khiri to come up with a new debt restructure plan so as to offer an IPO for the Samrong extension which needs a 5-6 billion baht investment.
The current debts of BTS are 39 billion baht--33 billion baht in principle and 6.3 billion baht in outstanding interest.
30% of BTS debt is in baht denomination while the other 70% is in US dollar denomination.
The new plan is to:
1) Write off the debt by 8.5 billion baht - 6.3 billion baht in outstanding interest and 2.2 billion baht in principle.
2) Convert 4.3 billion baht debts into equity.
3) Convert 12 billion baht debt into bonds redeemable in 18 years.
4) The rest of the debts (14 billion baht) will be paid all in 18 years instead of 12 years.
This would compel BTS to cut down the par price of the share from 10 baht/share to 5 baht/share and the allocation of stocks will be as follows:
1) BTS would own 42.1% instead of 58% of shares
2) The creditors with insured equity would own 29.8% of shares
3) The creditor without insured equity would own 2.8% of shares
4) The rest would be an IPO
Mr. Khiree said he is going to handle the new debt restructure plan by himself. It would take 8 months to finish the new debt restructure plan since BTS gets 8-9 million baht revenue per day.
Note: TRT could exploit the conflicts between Mr. Khiree and Mr. Kasem (Super K), but the government has not done so since the plan to obstruct the Taksin extension backfired on the government.
The government should first solve its problems with existing Skytrain and subway operators before opening bids for the construction of new lines, said a source from the Transport Ministry...
Hong Kong's New World group and Samsung Life Insurance of Korea have acquired a majority stake in one of the Thai capital's two mass transit operators, a press report says.
The new partners now control more than 50 per cent of BTS, which operates two Skytrain elevated rail routes in central Bangkok...
Thairath correspondents said that BMA has hired the consultant to handle the 7.7-km Pinklao underground extension of BTS from National Stadium to Phrannok so they can submit the study results to the Committee for Conserving and Developing Rattakosin Island in January 2006 to get approval for the underground section to pass through Rattanakosin island with a price tag of 26.285 billion baht. The track would go underground in front of Wat Chaimonkhon, passing Rama 1 Road, Chakkaraphatdiphongse Road, Lan Luang Road, Ratchadamnoen Avenue, Thonburi Railway Station, and Issaraphab Road before ending up at Phran Nok.
There will be five stations for this Pinklao extension:
1) Kasatsuek - underground station at Bumrung Muang in front of Hua Chiaw Hospital with a gate in front of Sino-Thai Medical Center, Bangkok General Hospital, behind Europena Tower and footpaths before reaching Yotse Lane.
2) Phan Fah Leelart - under Ratchadamnoen Avenue before reaching Democracy Monument with a gate in front of Thewet Insurance, Bank Thai, Din So Road, and Internal Revenue Department - Bangkok Area 1.
3) Sanam Luang - under Ratchadamnoen Kal Avenue in front of Government Lottery Office, with a gate in front of the Government Lottery Office, Sanam Luang, WWI Monument, and Khok Wua intersection near the October 14 Monument.
4) Bangkok Noy - under Arun Amarin Road between Siriraj Hospital and Arun Amarin Bridge with a gate in front of Siriraj Hospital (but Wat Amarinthararam would be closer) and the Railway Market near Thonburi Station.
5) Yaek Fai Chai -under Phra Nok Road, 600 meters from Phran Nok Intersection and near the upcoming road from Phran Nok to Phutthamonthon Sai 4 with a gate at Charansanitwongse 31 and Charansanitwongse 31/1. This station is to interchange with the Blue Ring.
BMA would allocate 2 billion baht for land expropriation with the details as follows:
1. Rama I Road - in front of Wat Chai Mongkhon - 337 Sq. Wah, 0.101 billion baht
2. Kasatsuek Station - 1.759 sq. wah 0.593 billion baht
3. Phanfah Leelart Station - 259 sq. wah - 0.067 billion baht
4. Sanam Luang Station - 810 sq. wah, 0.210 billion baht
5. Bangkok Noy Station - 5022 sq. wah 0.593 billion baht
6. Phran Nok Station - 1719 sq. wah, 1.719 billion baht
This line is to deal with traffic jam on Ratchadamnoen Avenue which is already at 16,097 cars/day/traffic lane (741 cars/hour/traffic lane) and Pinklao Bridge which is already saturated as with 18,796 cars/day/traffic lane.
Notes: The extension would definitely be very popular and the central government would be in serious trouble if they obstruct this extension, because it would boost more passengers who ride train to Namtok and Kanchanaburi and those who want to go to Sanam Luang.
BMA would have to make serious consideration about feeder buses and vans to pick up those who live along Pinklao Road up to the Southern Bus Terminal to feed into the Pinklao extension.