SEC urges CWT shareholders to exercise caution

 

The group’s proposal to invest in a Bt1.47-billion waste-treatment plant through a holding company established by CWT, Zero Waste and LAWI Engineering (Thailand) is an acquisition of a material asset, so the transaction is subject to the prior approval of shareholders. 

CWT’s board and audit committee viewed the investment project as beneficial, reasoning that it had the potential to generate profits and create value for shareholders.

However, the independent financial adviser (IFA) reached the conclusion that shareholders should not approve the proposed transaction because of limited information and uncertainty in material information. 

CWT has been in the process of submitting the proposal for operating the waste incinerator to the municipality. It has not been notified if approval will be forthcoming.

CWT could not submit to the IFA any agreements, such as joint-venture agreements with Zero Waste and LAWI or a waste-management agreement with the municipality. 

Based on CWT’s assumptions, the IFA also found that if the project does not go as planned, and investment costs increase while income does not, cash flow will be negative. 

“In this regard, the SEC advises CWT shareholders to study the information carefully, exercise their rights at the shareholders’ meeting on July 1 to protect their own benefits, and seek clarification or explanation from the company’s directors and executives so as to have sufficient information for their decision-making,” the stock-market regulator said.