Rightman, CMO see lower costs in new partnership
RIGHTMAN CO, a Thai event organiser, yesterday partnered with listed company CMO Group with the aim of reducing operating costs at CMO by at least 10 per cent while seeking the possibility of a backdoor listing for Rightman on the Stock Exchange of Thaila
Upathum Nisitsukcharoen, chief executive officer of Rightman, said this new collaboration and his fresh investment in CMO Group were the first steps for future growth of his company.
Last Friday, CMO reported to the SET that Sermkhun Kunawong, a major shareholder and CEO of the company, had sold 38,319,400 shares, representing 14.99 per cent of his total voting rights, to Upathum, the second-largest shareholder. Sermkhun retained his position as the No 1 shareholder with 28.86 per cent, down from 43.86 per cent.
Upathum said CMO was a top event-management firm with revenue of more than Bt1 billion a year, but its net profits were below his expectations. So he will soon join the management team to help improve efficiency.
Even though CMO last week insisted in its statement that its management structure and business policy remained unchanged, Sermkhun said yesterday that future changes could be made if the board of directors so decides.
Upathum said this investment could lead to a backdoor listing of Rightman in the near future but he wanted to make sure that the financial results of this move were right on track.
Under the latest collaboration, CMO and Rightman will pool their resources, particularly related to audio-visual equipment, construction and software management, to support a new business unit that will provide interior designs for shopping malls, hotels, auto showrooms and flagship stores.
“We are witnessing tremendous growth in Thai retail business, which keeps expanding its stores both at home and in neighbouring countries,” Sermkhun said.
By sharing resources, the two companies expect to reduce costs by 10-20 per cent and improve their bottom lines accordingly. By 2019, CMO targets Bt1.7 billion in revenue while Rightman aims for Bt1.3 billion.
Founded in 1986 before being listing on the SET in 2004, CMO Group employs more than 500 staff to provide holistic marketing communication solutions ranging from event organising and production and creative visual and visual solutions to tourist-attraction development and management. CMO’s revenue decreased by 28.9 per cent in the second quarter from the same period last year because the company did not have special projects.
Sermkhun said that so far this year, his company had secured a backlog of Bt900 million, while this year’s revenue target was Bt1.1 billion.
Meanwhile, Rightman’s revenue target for this year is Bt1 billion.
According to the Commerce Ministry’s Business Development Department, Rightman last year suffered a 1.07-per-cent drop in revenue to Bt688.48 million but its net profit managed a 21.24-per-cent increase to almost Bt40 million.
