Air-services firm to build condos
Thai Airports Ground Services (Tags) is entering the property-development business, in hopes of lifting its revenues after failing in its bidding for ground-service projects at Suvarnabhumi Airport.
Managing director Anuphong Rojnuckarin said yesterday the newly established and wholly owned subsidiary Tags Property would invest in a condominium project called Signature Suvarnabhumi. It will consist of four seven-storey buildings with a total of 1,540 units, covering nearly 4 hectares of land on Lat Krabang Road, about 6 kilometres from the airport. Construction begins next month and should be completed in April 2008. Anuphong said funds for the project would come from loans and the company's working capital. "After Tags failed in bidding for projects at Suvarnabhumi Airport, it tried to seek additional revenues from aviation-related businesses," he said. Moreover, work at the airport, which was the company's main source of revenues, was outsourced to others. Consequently, its gross margins are thinner and revenues lower. However, Tags recently hired a Singaporean consultant and set a budget of US$10 million (Bt359 million) to reorganise its business structure. Property development is one of several alternative businesses suggested by the consultant. Anuphong said Tags was also advised to restructure its shareholding. Thais previously owned 66.5 per cent of the company and foreigners 33.5 per cent. Now, the company has increased its registered capital from Bt25 million to Bt1 billion. Its paid-up capital is about Bt525 billion, Thai investors own 51.5 per cent, and the remaining 48.5-per-cent stake is held by the Singaporean company Frobisher. The company's new Thai shareholders include Airports of Thailand, with 28.5 per cent; Travel Services, 15 per cent; and Power Link, 8 per cent. Anuphong said the company's core business would remain aviation-related, and if it finds the opportunity to expand into foreign countries by providing airport services in, for example, Indochina or the Middle East, it will do so. Tags also plans to expand into free-zone management, airport-trolley management, ground-support equipment, passenger services, VIP-lounge services and aircraft equipment maintenance. Watcharapong Thongrung The Nation
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