CP to gradually reduce its shareholding in airport railway project to raise further funds

FRIDAY, October 25, 2019

Suphachai Chearavanont, chairman of Charoen Pokphand’s executive board expressed his pleasure at being part of the high-speed railway project linking three international airports following the contract signing ceremony between the CP consortium and the State Railway of Thailand (SRT) on Thursday (October 24),

“CP Group is proud to be a part of this public-private joint investment that will connect Don Mueang Airport in Bangkok, Suvarnabhumi in Samut Prakan and U-tapao in Rayong,” he said. “CP will follow the contract details to the letter and work closely with our partners including China Railway Construction Corp, Bangkok Expressway and Metro Pcl (BEM), Italian-Thai Development Plc and Ch Karnchang Plc.

Suphachai (front row right) at the contract signing ceremony on Thursday (Oct. 24)
Suphachai further explained that construction would begin with 12 months of the area survey and contractor negotiation processes and is expected to be completed within 5 years as planned. “The most challenging areas are the Phayathai - Don Mueang section, which requires the demolition of existing infrastructure, and the Suvarnabhumi - U-Tapao section, which has the longest route,” he said.
“Currently CP holds 70 per cent share in the consortium, but we are planning to reduce our shareholding to 51 per cent during the construction period to attract more funding while maintaining our decision-making power,” said Suphachai. “After the construction is complete, CP will further lower its shareholding to 40 per cent to invite additional investment funds through various methods, including entering the stock exchange.”
Over the next six years, CP expects to raise Bt220 billion to cover the construction and development costs, he added.
The 220 km high-speed railway linking three international airports is scheduled to open in 2023, after which CP will be responsible for the Transit-Oriented Development (TOD) of areas around the train stations to expand the businesses and distribute income to surrounding communities. This project has an estimated economic return of Bt650 billion and is expected to create 16,000 jobs during the construction and 100,000 more jobs in related businesses over the next five years.