TOT looks a major restructuring

TOT looks at major restructuring

01 SEP 2014

Thailand’s state-owned TOT is looking at splitting into five or six subsidiaries with private operating partners, in order to turn around the organisation which lost THB1.3 billion ($40.6 million) in the first half of the year and is on track for a THB10 billion loss for 2014.

The State Enterprise Policy Commission, or ‘superboard’, set up by the National Council for Peace and Order to review the operations of four state enterprises, ordered TOT to submit a plan for cutting non-core businesses and focus on six areas to enable it to streamline operations and cut costs.

A source involved in the superboard plan told Mobile World Live that there would likely be a breakup into five to six subsidiaries, which would need to find private joint-venture partners.

The six areas are telecoms infrastructure, tower operation, broadband service, mobile wholesale, international gateway/submarine cable and ICT/cloud business.

TOT was due to submit the first part of its business plan to the commission last Friday.

CAT, which is a step ahead in the process and had a THB600-million profit in H1, submitted a five-year ‘survival plan’ under the previous government and also is looking at being organised under the six broad areas.

The source said CAT knows clearly what it wants and is in a different position than TOT, which has 20,000 staff compared with CAT’s 6,000. CAT forecasts a THB1.7 billion profit on THB55 billion of revenue this year.

“The superboard wants to know what its legal disputes may cost, how close it is to being bankrupt, and how it can be cleaned up,” he said.

Both state enterprises have been asked to carry out the due-diligence process within three months.

Last week the TOT board approved the resignation of president Yongyuth Wattanasin, while CAT’s board approved the resignation of president Kittisak Sriprasert.

Natthawut Amornwiwat, a TOT board representative, told the Bangkok Post that its 3G operation would be the highlight of the new plans. It will expand 3G coverage nationwide by adding up go 15,000 base station to its existing 5,300. The 3G unit only has 10,000 subscribers.

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Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

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