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NEWS UPDATES 15 June 2010

Thai government wants Thaicom satellite back

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The Thai government is pulling out all stops to buy back Thaicom Plc, that Shin Corp sold to a Singapore company which provoked the 2006 coup and subsequent political turmoil, according to the Bangkok Post.

Prime Minister Abhisit Vejjajiva yesterday firmly backed moves to buy back the national satellite operator for security reasons.

He has given the Finance Ministry his full support to negotiate an appropriate price with the owner, Singapore's Temasek Holdings.

The ministry has begun negotiations with Temasek, which owns Thaicom directly through outright share holdings and indirectly through associated companies. But its efforts have been given added impetus to complete the deal with the prime minister's support.

Mr. Abhisit said it made sense from a national security perspective to get back the satellite assets from the Singapore state-owned investment company. The satellite has orbital slots which are regarded as national assets and should be owned by Thailand.

The sale of Thaicom to Temasek by Thaksin Shinawatra's family-owned company, Shin Corporation, in 2006 sparked the biggest political furore in Thailand in years. Public anger at the sale of national assets was further fuelled by sideline issues such as the failure to pay taxes on massive profits made by Thaksin's children and the involvement of foreign companies in brokering the deal.

Former prime minister Thaksin, who became embroiled in a major public backlash over the deal, was ousted in a coup later that year.

New Information and Communications Technology Minister Juti Krairiksh confirmed the negotiations, saying it was one of the three priorities he had been set by Mr. Abhisit upon taking office.

The others are e-government procurements and monitoring web sites critical of the monarchy.

He said he has already begun working closely with the Foreign Ministry and coordinating with the International Telecommunications Union to retain Thailand's hold on its remaining orbital rights and to buy back the satellite firm.

"On the Thaicom case, I'm a Thai citizen and I wish the company to be returned to Thailand because the matter involves orbital slots which are national assets," Mr Juti said. Mr. Abhisit's aide, Sirichok Sopha, said no formal offer has yet been made. Negotiations are only just beginning to gather momentum.

In 2007, Thailand's military-appointed government started informal talks with Temasek to buy back the satellite company.

The government launched its move to buy back Thaicom as it battled anti-government protesters who used the company to transmit the signal of their own satellite television station.

Mr. Sirichok visited Singapore in April with Finance Minister Korn Chatikavanij to meet with Temasek, which said it is willing to consider the deal. The government will make the purchase either through the government-owned MCOT Plc or one of two state enterprises controlled by the ICT Ministry, Mr. Sirichok said.

Thaicom's satellite concession expires in 2021, according to its website. The company founded by Thaksin in 1991 has reported a net loss in three of the past four years and has not paid a dividend since 2004, according to data compiled by Bloomberg.

Temasek directly owns 41.7 percent of Shin Corp, while a group of investors, including a Temasek unit, holds 54.6 percent, according to Thai stock exchange data.


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