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Published on September 14, 2007

The SET has ordered EWC to submit the clarification by next Monday.

EWC previously submitted to the SET financial statements of the second quarter ending June 30.

The SET said the Bt500-million loan that EWC gave to Siam General Factoring (SGF) is critical, affecting EWC's financial position through the allowance for a doubtful debt transaction.

EWC's board appointed an outsider to make a decision on the loan settlement. The SET ordered EWC to explain why it gave such authority to an outsider to make a decision regarding the settlement from SGF in both price and method. In addition, EWC is required to explain its process for nominating the said outsider.

EWC must clarify the name and background of the authorised outsider, that person's period as EWC's legal consultant and whether this is a connected person.

 EWC also earlier disclosed it had transferred land and buildings worth Bt190 million to settle a debt from SGF, and the land will be registered as belonging to EWC within 45 days from the date of the compromise on making the settlement (August 21).

However, the land transferred was from JJ Land Development and Rama 9 Trading and Service located in Tambon Saikaw of Chiang Rai's Phan district. But the SET found that the mentioned 982 rai of land had the same location as the Sun Valley Golf and Resort project, the appraised value was Bt363 million, and JJ Land Development had mortgaged the project as collateral for its loan from EWC amounting to Bt328 million in 2005.

The SET then ordered EWC to clarify whether the mentioned land was the same plot of land in the project that JJ Land had pledged as collateral in 2005. If it is, EWC must explain the difference in the appraised price and details of building.

Regarding its investment in Enersol, EWC must explain why it recorded an allowance of Bt5.48 million for impairment of Enersol while the board f directors still approved additional investment and agreed to the purchase for Bt72 a share instead of Bt55. EWC must disclose the reasonable price, method and opinion recommended by the financial adviser.

The company must explain why it calculated the final price based on the best case instead of the normal case as provided by the financial adviser.

Siriporn Chanjindamanee

 The Nation