Thai iTV Board Approves Debt Workout; Shin Corp Stake

Dow Jones Newswires

BANGKOK -- Thai television broadcaster iTV PCL said Tuesday its board of directors approved the company's debt-restructuring plan, under which telecommunications conglomerate Shin Corp. PCL (H.SWC) and Siam Commercial Bank PCL (H.SBK) will become its major shareholders.
In the first stage of the planned restructuring, Shin Corp. and Siam Commercial Bank will inject combined fresh funds of 550 million baht ($1=THB39.181) into the unlisted, independent broadcaster. The funds will be used to pay concession fees to the government coming due on July 3, iTV chairman Prakit Pradipasen said.
Siam Commercial Bank will contribute THB289 million, while the remainder will come from Shin Corp. They will receive stakes of 19% and 17% in iTV, respectively, Prakit said.
In the second stage, registered capital will be reduced to THB387 million from THB1.5 billion, to reduce accumulated losses, he said.
Capital will then be increased to THB4.5 billion through the issue of new shares to Siam Commercial Bank and Shin Corp.
In the second round of capital raising, Siam Commercial Bank will swap debt for equity, while Shin Corp. will pay for new shares.
Most of the funds injected by Shin Corp. will be used for further repayment of some THB4 billion in current debt, most of it held by Siam Commercial Bank.
Shin Corp. was previously expected to take a 40% stake in iTV. The company said it will hold a news conference Wednesday at 0700 GMT (3:00 a.m. EDT) to announce its plans for the broadcaster.
Prakit said iTV's debt should drop to THB1 billion after restructuring, which will be rescheduled to a term of 11 years.
The plan is subject to iTV shareholder approval at a meeting scheduled for June 26.
Prakit said 25 million warrants will be issued to current shareholders of iTV, excluding Siam Commercial Bank and Shin Corp., giving them the right to buy one share for each warrant within five years after the company floats shares in a planned initial public offering.
The exercise price of the warrants will be 20% lower than the market price, he said.
The Thai royal family's Crown Property Bureau and related entities currently hold 43% of iTV.
Some members of iTV's news team - most of them from Nation Multimedia Group PCL (H.NMG), which holds a 10% stake - have opposed the sale of a large stake to Shin Corp., arguing that it would compromise the broadcaster's editorial independence.
Tycoon turned politician Thaksin Shinawatra was a former chief executive of the Shin Corp.
Shin Corp. has said its planned partnership with iTV won't interfere with the editorial impartiality of the broadcaster's news coverage, and that its intentions are to become an integrated telecommunications group.
Nation Multimedia has proceeded to launch a 24-hour news channel on the local United Broadcasting Corp. PCL's (H.UBC) cable service.