The Thai government will sell down stakes in other state-owned enterprises to maintain a 40% plus shareholding in Thai Airways International (TG, Bangkok Suvarnabhumi). A planned THB25 billion baht (USD658 million) debt-to-equity conversion will see the Ministry of Finance's existing 47% shareholding watered down, but the ministry is only prepared to let their holdings fall so far.
According to The Bangkok Post, Pantip Sripimol, director general of the State Enterprise Policy Office (Sepo), has said the ministry will need to spend THB10 billion (USD263 million) to keep its shareholding above 40%, a threshold agreed to when hammering out the airline's rehabilitation plan.
The ministry has already decided the funds will not come from its annual budget allocation, instead electing to sell down shareholdings in other enterprises. While Sripimol says no decision has been made regarding the details of the share sales, she did say non-listed enterprises were on the ministry's radar, notably around 20 non-listed state-owned enterprises the government had acquired via purchasing foreclosed assets. According to the OECD, the Thai government has interests across multiple industrial sectors, including airports, seaports, banks, and oil and gas enterprises.
After months of negotiations, Bangkok's Central Bankruptcy Court gave Thai Airways' revised restructuring plan the green light on October 20, allowing the airline to progress with its restructuring, which includes the debt to equity conversion and a recapitalisation. The finance ministry fully supported the restructuring plan.
Kasikornbank analysts expect Thai Airways to generate revenues of THB40 billion (USD1.05 billion) in 4Q 2022 but still make a loss, largely because of external factors such as fuel prices. While the bank expects the airline's financial performance to continue to improve, it isn't flagging a return to profitability until 2024. When this occurs, there are expectations that Thai Airways will relist on Bangkok's stock exchange.
