My Account Menu

CAPA Login

Register to trial CAPA Membership!

Thai Finance Ministry to invest further capital in Thai Airways - with strings attached

30-Mar-2010 11:09 AM

Thai Finance Minister, Korn Chatikavanij, stated the Finance Ministry is prepared to support Thai Airways’ capital raising plans and invest additional capital in the carrier on three conditions (Reuters/The Nation, 30-Mar-2010). Conditions include cutting costs by 20% in three years, increasing revenue and to do so without the government’s guarantee for aircraft procurement. The carrier plans to sell up to 1 billion new shares to shareholders and the public, in an offer worth up to USD880 million. The Ministry plans to invest the additional capital to maintain its 51% majority stake. Meanwhile, the Ministry also plans to request Cabinet approval for Thai’s plans to acquire 15 new aircraft.

Thai Finance Ministry: “The significant condition is the end to guarantees. In aircraft acquisition contracts, there was an obligation that the Ministry's holding must not go below 51%. I don't know who authorises whom to offer the obligation,” Korn Chatikavanij, Finance Minister. Source: The Nation, 30-Mar-2010.