Thai Petroleum Agency to Sell 15-20 Billion Baht in Shares at Public Offering.

Byline: Wichit Sirithaveeporn

Sep. 8--The Petroleum Authority of Thailand has set a market value for its shares at 20-30 billion baht, of which 15-20 billion baht will be sold in an initial public offering scheduled for the next few months.

A public hearing on the privatisation programme will be held today at the Bangkok International Trade and Exhibition Centre.

The privatisation plan is expected to be completed by November. Potential investors will also be surveyed on the appropriate IPO price, which in turn will be compared with prices suggested by financial advisers, which include Merrill Lynch Phatra, Tisco Securities, SCB Securities and several foreign investment banks.

PTT staff will be offered a 5 percent stake in the company through warrants carrying terms of 3-5 years, with each employee receiving shares worth 5-8 times their monthly salary, based on seniority and their current salaries. After the PTT is transformed into a limited company, it will calculate a new throughput charge based on parameters approved by the cabinet, which in turn will be submitted to the National Energy Policy Office for approval.

Parameters include a return on equity of 18 percent from operating costs, a flat 3 percent of the whole project cost for maintenance expenses, a debt-to-equity ratio of 3:1 and funding costs of 10.5 percent.

The task of setting ...