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Cooperatives dept negotiates payment plan for THAI debenture holders

May 22. 2020
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By The Nation

The Cooperatives Promotion Department will negotiate payment plans with 81 cooperatives that have bought Thai Airways International (THAI) debentures.

“Initially we will look into different ways of handling the debt, such as postponing repayments, making cuts or changing debt to equity, Phichet Wiriyapaha, the department’s director general, said.

He added that the 82 cooperatives had bought Bt42 billion worth of THAI debentures and the total assets of the cooperatives stood at approximately Bt1.17 trillion.

He also said that if the Bankruptcy Court approves the airline’s rehab plan, then the debt will be paid in line with the plan.

Meanwhile, Transport Minister Saksayam Chidchob said that in line with preparations for filing bankruptcy and rehabilitation of the national carrier, the airline’s board of directors need to prepare details about THAI’s assets and liabilities, as well as come up with a debt-repayment schedule.

“We have also asked THAI’s board of directors to come up with a list of names for the planning team as well as terms of reference to hire financial and legal consultants, which the ministry will propose to Prime Minister Prayut Chan-o-cha for consideration,” Saksayam said.

He also said the board has to come up with a liquidity management plan to cover salaries and other payments, though it will have to be cleared with the Thai Airways Union and the airlines 20,000 plus employees.

“The board also has to cooperate with the investigation team appointed by Deputy Transport Minister Thaworn Senniam to gain the confidence of creditors,” he said.

Meanwhile, officials at the ministry said THAI was still able to pay salaries and make other payments until the end of June, though it has to negotiate delays in repayment with creditors.

“If THAI comes up with a rehabilitation plan in the next three to four weeks, we expect it to be able to cover salaries and other payments until the end of October,” an official said.

Deputy Prime Minister Wissanu Krea-ngam, meanwhile, said the government will no longer provide financial aid to THAI.

“Once the Finance Ministry sells 3 per cent of its shares, bringing its holding down to 48 per cent, then THAI will lose its state-enterprise status and become a public company,” he said.

He made the comment after meeting with Finance Minister Uttama Savanayana, Saksayam and representatives of the State Enterprise Policy Committee on Thursday (May 21).

Meanwhile, the Finance Ministry is discussing the sale of its shares with Vayupak Fund.

Wissanu said that as the largest shareholder, the Finance Ministry is also building a team to layout the rehab plan to present to creditors and the Bankruptcy Court.

If the creditors reject the plan, then the deal will collapse, or if the creditors agree and the court doesn’t approve, the deal will also collapse, he said. The rehab plan will only work if both sides agree, he said.

He added, both the Finance and Transport ministries will set up a rehab management team in three months.

An informed source said the Transport Ministry will propose 15 experts, and another 15 will be proposed by the Finance Ministry for the rehab job.

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