DEBT RESTRUCTURE

Court gives approval to BTS plan

Seven secured creditors fail in bid to block Keeree's proposal

Bangkok Mass Transit System (BTS) CEO Keeree Kanjanapas triumphed over creditors yesterday when the Central Bankruptcy Court ruled in favour of his Bt50-billion debt-restructuring plan for the Skytrain operator.

The ruling came despite seven secured creditors having voted to veto the plan.

The court said the debt-restructuring plan would allow BTS's creditors to receive greater repayments than the alternative of declaring the Skytrain company bankrupt.

The plan stipulates that creditors will receive Bt44 billion, accounting for 66.23 per cent of total debts.

If BTS had been declared bankrupt, creditors would have received only Bt33 billion, or 50.08 per cent.

The company will now accelerate its efforts to find fresh capital of US$600 million (Bt21.48 billion) to service a portion of its debts, as stated in the plan, said Surapong Laohaanya, a director.

He said funds might come from borrowing, recapitalisation or the company's working capital.

Apart from cash repayments of debt, the company will also repay through debt-to-equity conversions and must raise Bt12 billion from new partners.

Keeree said BTS would book a Bt20-billion profit from the debt restructuring and that this would be recorded in the company's fiscal year ending March 31.

A group of 10 investors, most of them foreign, have expressed interest in buying a sizeable stake in the Skytrain operator, he said. Following today's court ruling, BTS will begin negotiations with them.

Keeree said he expected more than one investor to become a BTS partner, with shareholding not exceeding 49 per cent. One of them might be a Dubai-based investor group that earlier invested in Tanayong, another of Keeree's companies.

Meanwhile, a creditor source said BTS creditors who objected to the plan would have to appeal the court's ruling. However, the initial response from creditors was to opt for cash repayment.

The debt-restructuring plan offers two options for creditors: cash repayment or asset repayment.

Siriporn Chanjindamanee

The Nation
Thu, February 1, 2007