Merchant Partners plans listing in Q1

Today's Business News - Wednesday December 12, 2007

STOCKS / MARKET SENTIMENT AND NEW LISTINGS

Merchant Partners plans listing in Q1

NUNTAWUN POLKUAMDEE

Merchant Partners Securities plans to list on the Market for Alternative Investment (MAI) in the first quarter of 2008. The brokerage was founded by a group of Thai-Chinese business families in mid-2005, with the Pathomsak group holding 35.5%, the Chansiri group 11.67%, the Sethiwan group 10%, the Tuangsithisombat group 10% and the Chayavivatkul group 10%.

Kasemsit Pathomsak, the firm's president and CEO, said the company had broken even on operations with revenue of 100 million baht over the first nine months of this year, up from 40 million in the same period last year.

Net profit in the first nine months was 8.7 million baht, he said, although accumulated losses remain at around 140 million baht.

Mr Kasemsit said the company's market share was currently 0.7%, but it was confident that it could grow and survive growing competition with sector liberalisation over the next two years.

''Our strong point is we have a niche that's different from other brokers. We have a group of high-net-worth clients who hold shares in the company, so they invest and trade and use the financial services offered by the company. So even if trading is volatile, it doesn't really affect our operating income,'' he said.

With a business model based on wealth management, brokerage fees were not the main focus, as the firm sought to offer a range of financial services to investors, he said.

''We are a small company but we can offer unique services,'' Mr Kasemsit said, adding that fee-based income would eventually surpass that of brokerage fees.

The company currently has 1,500 trading accounts, of which 80% are active. More than 70% of its clients have trading volume of 10 million to 20 million baht per account.

He said listing on the MAI would help the image to the company, and funds raised from the IPO would be used business expansion into areas such as derivatives and private funds, and for working capital.

''Next year we plan to join with foreign funds to expand our business into overseas markets,'' Mr Kasemsit said.

Merchant Partners will float new 100 million shares at a par value of one baht each, raising paid-up capital to 600 million baht from 500 million now. The Pathomsak group's shareholding will be diluted to around 20% after the offering.

Bangkok Post