Thai govt urged to reduce stakes in TOT, CAT

Dylan Bushell-Embling
08 Dec 2014
00:00

The upheaval of Thai state-owned operators TOT and CAT is set to continue, with the Thailand Development Research Institute recommending that the government divest a significant part of its stake.

The government should reduce its holding in TOT and CAT from 100% to a maximum of 51%, TDRI's chairman Somkiat Tangkitvanich told the Bangkok Post.

Diluting the state's ownership in the operators would alleviate the tradition of political intervention into the affairs of the ailing operators, he said.

Opening up investment would also give private operators a chance to invest in the companies to help turn them around.

The TDRI's recommendations come days after the government ordered TOT and CAT to merge and immediately cut costs by 10%.

But Somkiat said he does not support a merger between the operators because he does not think it would resolve their financial woes.

Both operators are hurting from the loss of concession revenue due to the Thai market's transition from a build-operate-transfer arrangement to a more conventional spectrum licensing regime.

As part of the restructure plan, TOT and CAT have been told to terminate unprofitable operations and focus on the core areas of infrastructure, wireless and fixed broadband, international gateways and subsea cables.

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