B-Land 'will pay' half of MRT extension

The company has proposed to |the Transport Ministry that it |would pick up half of the Bt1.2-|billion cost, with the Mass Rapid Transit Authority (MRT) chipping in the other half, chairman Anant Kanjanapas told a news conference yesterday.
However, the MRT has asked for Bangkok Land to pay for the whole project, so the company has to wait and see if a solution can be found.
If the MRT does not accept the offer, the company already has a plan to develop a monorail line connecting Impact with the Pink Line. That project would cost an estimated Bt600 million.
The Impact link would be launched after the Pink Line starts operating in five to 10 years.
A 300-room hotel worth Bt300 million will be built next year by Impact Exhibition Management Co to meet the demand for accommodation at the conference centre from the organisers of exhibitions at Impact.
Both the monorail and the hotel will be financed from the company’s internal cash flow.
“If that’s not enough, we plan to sell part of our land on Srinakarin Road, which has 1,350 rai, to generate cash for our expansion plan,” Anant said.
The moves come after the company concluded a deal to buy back 44.82 per cent of Impact Exhibition Management Co from South East Asia Opportunities Fund for Bt2.7 billion. The company paid the first Bt600-million instalment on Monday. The next Bt2.1 billion will be paid by January. More than half of the payment will come from the company’s internal cash flow and the rest from bank loans.
Bangkok Land sold the stake to South East Asia Opportunities Fund five years ago for Bt7 billion as part of its debt restructuring at that time.
“Now we hold 100 per cent of Impact Exhibition Management Co, so it’s easy to organise our business plan. And we may apply for a listing on the Stock Exchange of Thailand in the future,” Anant said.
Impact Exhibition Management Co targets revenue of Bt2.2 billion and net profit of Bt400 million in this fiscal year ending March 2013. For the next fiscal year, the com-pany is aiming for revenue to rise |by 10 per cent or Bt2.4 billion and for net profit to reach between Bt400 million and Bt500 million.
Bangkok Land’s business direction in the future will be to boost recurring income from the exhibition and meeting, hospitality and retail businesses. Residential developments will be kept small at Bt500 million to Bt2 billion per project.
“We learned from the economic crisis in 1997 that we have to use our cash rather than borrow from the bank. We’ll focus on businesses that generate long-term income,” he said.
Bangkok Land was burdened by more than Bt10 billion of debt in 1997. It decided to rehabilitate its finances by transferring assets to settle debt. As of June 30 of this year, its debt had been pared down to only Bt6.83 billion versus total assets of Bt39.28 billion.