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04-06-2014, 10:33 PM
Thai capital flees the kingdom in a quest for stable investment zones
LISA ALLEN AND BRIDGET CARTER NEWS LIMITED JUNE 05, 2014 12:00AM
Thai investment in Australia
Thai investment in Australia Source: TheAustralian
WEALTHY corporations are fleeing Thailand for more stable economies, with the kingdom's third richest tycoon backing Frasers Centrepoint’s aggressive $2.6 billion takeover bid for Australand.
If successful in acquiring the listed property developer, Frasers will join other Thai companies in Australia, including the $US3bn ($3.2bn) Minor International Group, which controls the locally founded Oaks Hotels and Resorts as well as Coffee Clubs and Ribs and Rumps restaurant outlets.
Thai investment in Australia has been growing for several years, with Australian Bureau of Statistics figures showing where Thai companies ploughed $561m into Australia in 2001, last year they invested $6.137 billion.
Often dubbed Thailand's “whisky king” after making a fortune supplying to distilleries producing the local brew, Charoen Sirivadhanabhakdi, who is based in Bangkok, controls 88 per cent of Singapore-listed Frasers Centrepoint through TCC Group. Frasers is behind Sydney's $2bn Central Park residential development in Broadway and recently picked up the Sofitel Wentworth hotel in the heart of Sydney’s financial district for $202.7m.
Mr Sirivadhanabhakdi could not be reached for comment on his plans for Australand yesterday, but other Thai billionaires have been more forthcoming about their need to diversify their businesses out of Asia.
“We have been in the past very dependent on Thailand,” Minor International’s founder, billionaire American businessman Bill Heinecke, told The Australian in a recent interview.
“We were very much a Thai company until 1997; then when the Asian crisis hit we realised how vulnerable we were and that was re-emphasised when we had the SARS, tsunamis, and airport closures. We took a decision back in the late 1990s we wanted to move and diversify our investments on a broader geography. In our five-year plan, 40 per cent of revenues are to come from overseas and 50 per cent of our profits — we are certainly looking well beyond Thailand.
“We have a good balance of businesses throughout Australia … it’s certainly politically a lot more stable than Thailand.”
Thailand’s political turmoil is affecting its economy, with gross domestic product shrinking 0.6 per cent in the three months to March compared with a year earlier. Thai production and tourism has been damaged by months of political unrest as enemies of former prime minister Yingluck Shinawatra succeeded in removing her from office.
The Bangkok-based Dillip Rajakarier, chief executive of Minor Group, does not believe Mr Sirivadhanabhakdi, who also attempted to buy the Ayers Rock Resort in Uluru several years ago, is bidding for Australand because of Thailand’s political turmoil.
“Thailand has gone through challenges (but) what is happening is the big Thai companies are looking to diversify and be global Asian players,” he said.
“I don’t think it is triggered by the Thai situation but it must be one of the key strategies
in terms of portfolio diversification.”
Goldman Sachs said TCC was well funded and trying to put money to work outside Thailand, recently bidding aggressively for assets in Singapore.
LISA ALLEN AND BRIDGET CARTER NEWS LIMITED JUNE 05, 2014 12:00AM
Thai investment in Australia
Thai investment in Australia Source: TheAustralian
WEALTHY corporations are fleeing Thailand for more stable economies, with the kingdom's third richest tycoon backing Frasers Centrepoint’s aggressive $2.6 billion takeover bid for Australand.
If successful in acquiring the listed property developer, Frasers will join other Thai companies in Australia, including the $US3bn ($3.2bn) Minor International Group, which controls the locally founded Oaks Hotels and Resorts as well as Coffee Clubs and Ribs and Rumps restaurant outlets.
Thai investment in Australia has been growing for several years, with Australian Bureau of Statistics figures showing where Thai companies ploughed $561m into Australia in 2001, last year they invested $6.137 billion.
Often dubbed Thailand's “whisky king” after making a fortune supplying to distilleries producing the local brew, Charoen Sirivadhanabhakdi, who is based in Bangkok, controls 88 per cent of Singapore-listed Frasers Centrepoint through TCC Group. Frasers is behind Sydney's $2bn Central Park residential development in Broadway and recently picked up the Sofitel Wentworth hotel in the heart of Sydney’s financial district for $202.7m.
Mr Sirivadhanabhakdi could not be reached for comment on his plans for Australand yesterday, but other Thai billionaires have been more forthcoming about their need to diversify their businesses out of Asia.
“We have been in the past very dependent on Thailand,” Minor International’s founder, billionaire American businessman Bill Heinecke, told The Australian in a recent interview.
“We were very much a Thai company until 1997; then when the Asian crisis hit we realised how vulnerable we were and that was re-emphasised when we had the SARS, tsunamis, and airport closures. We took a decision back in the late 1990s we wanted to move and diversify our investments on a broader geography. In our five-year plan, 40 per cent of revenues are to come from overseas and 50 per cent of our profits — we are certainly looking well beyond Thailand.
“We have a good balance of businesses throughout Australia … it’s certainly politically a lot more stable than Thailand.”
Thailand’s political turmoil is affecting its economy, with gross domestic product shrinking 0.6 per cent in the three months to March compared with a year earlier. Thai production and tourism has been damaged by months of political unrest as enemies of former prime minister Yingluck Shinawatra succeeded in removing her from office.
The Bangkok-based Dillip Rajakarier, chief executive of Minor Group, does not believe Mr Sirivadhanabhakdi, who also attempted to buy the Ayers Rock Resort in Uluru several years ago, is bidding for Australand because of Thailand’s political turmoil.
“Thailand has gone through challenges (but) what is happening is the big Thai companies are looking to diversify and be global Asian players,” he said.
“I don’t think it is triggered by the Thai situation but it must be one of the key strategies
in terms of portfolio diversification.”
Goldman Sachs said TCC was well funded and trying to put money to work outside Thailand, recently bidding aggressively for assets in Singapore.
