THAI ups Nok Air stake; expects good return

Ampon Kittiampon, THAI chairman of the board of directors, said the board agreed to buy 10 per cent or 5 million shares in Nok Air from Krung Thai Bank at Bt33 per share, totalling Bt165 million.
The purchase of Nok Air’s shares will increase THAI’s holding from 39 per cent to 49 per cent. This is in accordance with the company’s business plan to let the national carrier determine Nok Air’s strategic policies to be a competitive low-cost carrier and protect its market share from other budget and low-cost carriers.
With 49 per cent share in Nok Air, THAI will now have five directors out of nine on Nok Air’s board, compared to four previously.
The THAI board has appointed the airline president Piyasvasti Amranand as a director on Nok Air’s board.
Ampon said Nok Air would operate in the domestic market and not compete with its newly established budget airline, THAI Smile, which is set to run regionally.
“Both Nok Air and THAI Smile will complement THAI,” he said.
He added that THAI would gain more than 10 per cent return on investment in Nok Air as the airline has strategic plans such as scouting for new aircraft with lower emissions, improve services and human resources, enhance aeroplane utilisation and sourcing maintenance at cheaper cost.
“No reason to leave from Nok Air. It will help THAI to have for return,” said Ampon.
Nok Air has doubled its revenue projection for the year to Bt400 million.
Ampon said THAI had set up a crisis management operations centre to deal with the current flooding and was confident the airline would not be affected by the problem.
THAI’s board of directors yesterday agreed to let Suvarnabhumi Airport Hotel Co undergo restructuring under the bankruptcy law, to improve its management of the hotel and resolve its financial situation.
THAI holds 30 per cent in Suvarnabhumi Airport Hotel Co. THAI board members of the hotel would seek answers as to why the hotel’s operations had failed despite dominating the area while the airline passengers has been increasing.
The number of passengers flying THAI in September was 5.9 per cent higher year on year. The revenue passenger-kilometre for September was 0.7 per cent higher than in September 2010. Cabin Factor for September 2011 averaged 70.1 per cent, 4.1 per cent lower than in the same period last year.