Bangkok Airways’ IPO imminent

Bangkok Airways' long-pending initial public offering (IPO) looks poised to get off the ground within the next two months, unperturbed by changes in Thailand's political landscape.

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Puttipong Prasarttong-Osoth, president of the privately-owned regional airline, said the IPO, which may raise 10 billion baht in proceeds, could take place towards the end of July or early August.

"Things are looking up from an economic point of view after the National Council for Peace and Order took control, and the stock market has not tumbled as some anticipated, so there is no point in putting off our IPO any longer,'' he told Bangkok Post.

The Stock of Exchange of Thailand (SET) has done relatively well after the May 22 coup, showing the Thai capital market is intact and ready to accommodate new issues from companies like Bangkok Airways, he added.

The 46-year-old carrier, largely owned by founder and billionaire Prasert Prasarttong-Osoth, Capt Puttipong's father, last week submitted the amended application for listing to the Securities and Exchange Commission (SEC). If approved it would allow the airline to proceed with the expected IPO debut time frame.

The airline has seemed to overcome previous SEC scepticism over the company’s accounting system. The SEC was concerned the airline might understate its liabilities, particularly involving the Samui Property Fund (SPF), which owns Samui Airport. SPF is a major asset of Bangkok Airways.

The SEC previously regarded SPF’s accounts as not complying with local practice and wanted sanctions imposed. However, the SEC finally agreed to remove the regulatory barrier and approved the IPO, according to industry sources.

The airline has yet to announce details of the IPO including the exact size of the share divesture though the minimum was set at 25%.

In its previous filing with the SEC last July, the airline said it planned to list 730 million shares, of which 520 million would be new shares and the remainder existing ones.

Last year airline executives estimated 10 billion baht in proceeds could be raised through the sale of up to 30% of its shares in a partial divestiture that would end its full private ownership.

Capt Puttipong said proceeds from the IPO will allow several major investment plans to move ahead, such as a fleet renewal plan with up to 30 new single-aisle jets, valued at US$3 billion.

Other projects include a new aircraft maintenance, repair and overhaul hangar at Suvarnabhumi airport, estimated to cost 2 billion baht, and an IT system upgrade.

Its fleet renewal plan could be finalised later this year with the new aircraft rolling out in 2016. The airline’s single-aisle jet fleet now comprises 10 Airbus 319s and five A320s.

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