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Published on February 9, 2008

Temasek Holdings, the Singapore government's investment company, has reportedly approached Thai billionaires to buy shares in Shin Corp in a bid to eradicate the image that the firm is held through nominees.

An investment banking source said the billionaires approached include liquor tycoon Charoen Sirivadhanabhakdi, agro-business tycoon Dhanin Chearavanont, and even Shin's former owner, Thaksin Shinawatra himself.

He added that Temasek proposed the deal to Charoen, chairman of the Singapore-listed ThaiBev, three times before the tycoon showed any sign of interest in the proposal.

Temasek executives and Charoen could not be reached for comment, but a telecom analyst said the liquor tycoon was unlikely to be really interested in the telecom business, which would not benefit his current business interests ranging from property to liquor, food and trading.

The analyst added that the telecom industry was also in the sunset stage because of market saturation but still required intensive investment in networks, which is why the ousted prime minister's family decided to quit the business.

Shin's core assets are Advanced Info Service, Thailand's largest cellular operator, and Shin Satellite.

Charoen buying into Shin might help tone down Temasek's association with nominee holding, but it is doubtful whether the tycoon really wants to be in the telecom industry, the analyst said.

The analyst also doubts whether Dhanin, founder of Charoen Pokphand (CP), would want to buy a stake in Shin. CP is the parent company of True Corp, whose businesses include True Move, Thailand's third largest cellular operator, pay-TV firm True Vision, and broadband Internet.

He said CP might want to concentrate on supporting the debt-saddled True group of companies. "Moreover, if CP has both True group and Shin group, True would risk being accused of a telecom monopoly."

Thaksin is not a good choice of buyer for Temasek since it risks sparking the kind of street protests that followed the Shinawatra family's sale of their Shin stake to the Singapore firm in 2006.

"If I was Temasek, I would not put the hanging noose on my neck again," the analyst said.

He added that it was not surprising that Charoen or Dhanin would be listed as possible suitors, given that there are just a few Thai billionaires.

The Shinawatra family members divested their combined 49.6-per-cent stake in Shin to a consortium led by Temasek in January 2006 in a deal worth Bt73 billion, or Bt49.25 per share. Shin shares closed at Bt28 yesterday, up from Bt25.50 a day earlier, while AIS shares closed at Bt97, up from Bt94.50.

The tax-free deal prompted street protests and led to the overthrow of Thaksin's government by the Council for National Security and a probe by the new junta-backed government into the alleged use of nominees in the sale.

Two Temasek-linked companies, Cedar Holdings and Aspen Holdings, each currently own 54.51 per cent and 41 per cent of Shin respectively.

Kularb Kaew, which owns 41 per cent of Cedar Holdings, was alleged to be a Temasek nominee in the Shin acquisition deal. It later sold a 68-per-cent share to Surin Uptakoon, a Thai businessman based in Malaysia. Thai police are investigating whether Surin acted as a nominee of Temasek.

Shin is in the process of floating 15 per cent of its shares on the Stock Exchange of Thailand (SET). This is to comply with the SET rule that listed firms have to float a minimum of 15 per cent of their shares on the market.

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