Billionaire Wichai lends a hand to retailers with Link Network (Thailand)
AFTER consolidating provincial cable TV operators, prolific investor Wichai Thongtang is now helping 28 leading provincial retailers to form "Link Network (Thailand)" with the goal of expanding to more than 300,000 distribution channels nationwide by ne
"I still believe that the idea of a consolidated Thailand, if it can happen, will help strengthen local businesses’ sustainability and competitive edge.
"The merger of Phayathai Hospital Group and Bangkok Dusit Medical in 2011 is a good example. After the merger, both parties were able to manage operating costs effectively," Wichai said yesterday, referring to his hospital business.
When it comes to the distribution business, the consolidation of local businesses would give them greater bargaining power with large retailers and suppliers.
Link Network (Thailand) was launched with registered capital of Bt100 million. Wichai, who is at number thirteen on the Forbes (Thailand) rich list with a net worth of Bt50.7 billion, holds 25 per cent of Link Network with the remaining shares split between 28 retailers.
Wichai, who serves as chairman of the new company, is preparing central software and infrastructure to work with existing and new partners once the distribution network is up and ready.
Link Network (Thailand) would be a holding company for five subsidiaries, one in each region – North, Northeast, Central, East and South. In each subsidiary, Link Network (Thailand) will hold 80 per cent of shares while 20 per cent would be reserved for new strategic partners that appreciate this business model.
He insisted this business model was different from his CTH pay-TV operator, which is now suffering huge losses because of the changing media landscape and huge investment in the Bt10-billion broadcasting rights to three seasons of the Barclays Premier League. However, he would continue to bid for new seasons.
Link Network’s executives will conduct a series of road shows in the provinces to recruit potential prospects as distribution channels. They claimed that more than 150,000 distribution channels have signed up.
The new distribution firm plans to list on the Stock Exchange of Thailand in the near future.
"With our distribution channels, our network generates more than Bt20 billion a year, mainly from selling information technology, mobile devices and gadgets. We believe that next year’s revenues will surge to Bt40 billion," said Thanakorn Weerachatyanukul, owner of UD Town, a Udon Thani-based open-air shopping centre and one of the shareholders in Link Network (Thailand).
Thanakorn, who is also president of the Udon Thani Tourism Business Association, said his company had more than 20 years of experience in the distribution business in the provinces, so it would provide know how to help local enterprises in more than 900 districts in 77 provinces.
The new distribution company targets six markets: consumer products; IT and gadgets; mobile and telecommunications devices; TV and Internet; financial services; and small- and-medium-sized enterprises like Otop companies.
Paiboon Damrungchaitham, chairman of music and entertainment giant GMM Grammy, who attended the event, said he was interested in supplying GMM Z satellite TV receivers through this new logistics network.
