AIS examined after Thaksin asset seizure; shares drop but cellco says ‘not guilty’

2 Mar 2010

Following last Friday’s Supreme Court ruling to seize USD1.4 billion in frozen, contested assets from the family of Thailand’s former prime minister Thaksin Shinawatra, local newspaper The Nation reports that a legal team from the country’s ICT Ministry has been assigned to examine mobile and satellite operating concessions owned by subsidiaries of Thai conglomerate Shin Corp, formerly controlled by the family. Lawyers will carry out a review of previous amendments to concessions of cellco Advanced Info Service (AIS) and satellite provider Thaicom, which were criticised for benefitting Thaksin’s interests at the expense of the state. The directors and executives of state telecom enterprises – including PSTN operator TOT – which awarded the concessions, will also be scrutinised to identify who was involved in making the changes, and the results will be submitted for Cabinet consideration this month. The court verdict said TOT had lost THB70 billion in revenue when AIS was allowed to reduce the share of pre-paid turnover it paid TOT from 25% to 20% by altering its build-transfer-operate (BTO) concession with the telco. TOT and fellow state-owned telco CAT were also deprived of concession fees totalling THB60 billion when a telecom excise tax was introduced to replace the fees. Meanwhile, the Transport Ministry’s contract with Thaicom (formerly Shin Satellite) was amended several times to the firm’s benefit, costing the state THB20 billion, the ruling said.

AIS has hit back at the news that its business will be investigated. Quoted today in the Bangkok Post, AIS CEO Wichian Mektrakarn blasted: ‘The Supreme Court’s verdict deals directly with [former] shareholders. It has nothing to do with the company… We have done nothing wrong and are ready to fight back with evidence.’

Reuters reports that shares in Shin Corp, AIS and Thaicom all slumped today due to uncertainty over the court decision, which said that Thaksin, who was ousted in a 2006 military coup, and his former wife, concealed ownership of shares in Shin Corp and tailored government policies to benefit Shin businesses. The value of AIS shares was down by around 4% this morning.