Seafood counter display at a Carrefour hypermarket. (Photo: Terje Engoe)

State firm pulls out of bid for Carrefour

THAILAND
Friday, September 24, 2010, 18:40 (GMT + 9)

State-controlled company PTT Pcl, which is also the top domestic energy firm in Thailand, has withdrawn its bid to buy all Thai related assets from the French retailer Carrefour SA, supposedly due to pressure from the Thai government - Prime Minister Abhisit Vejjajiva and the cabinet - after reviewing the plan.

Thai conglomerate Berli Jucker Pcl (BJP), Thai retailer Central Group, France’s Casino and Britain’s Tesco are now consequently the only four companies left in the running to buy Carrefour’s assets in Thailand, which are worth some USD 600 million. BJP is reported to currently have the lead.

The number one retailer in Europe, Carrefour intends to sell its stores in Malaysia, Singapore and Thailand at a possible price of USD 1 billion, so that they can concentrate on markets where the company finds itself as market leader.

Abhisit recently doubted the motive of Thailand's largest majority state-owned firm, questioning why it was interested in businesses beyond of its central petroleum market, reports the Bangkok Post.

The Finance Ministry owns 51 per cent of PTT, which with a capitalisation of BHT 815 billion (USD 42.4 million) is also the largest company on the Stock Exchange in Thailand.

The minister reiterated his worries recently and gave a caveat to the company that it ought to be careful because it might be in violation of a constitutional provision that prohibits state enterprises from bidding against private ones.

But PTT assured it was not facing pressure to withdraw.

"The company itself decided not to join the bidding, it wasn't an order from the political side," insisted president and CEO Prasert Bunsumpun.

Auttapol Rerkpiboon, an executive VP, said company shareholders also disliked the idea and voiced concern about a major shift to the retailing industry.

"As the shareholders disapproved, there was no way for us to go ahead without approval, so we decided to drop it right now," said Auttapol.

Second round bids have a deadline on 5 November, according to two other sources with know-how of the bidding process, Reuters reports.

Thai Energy Minister Wannarat Charnnukul recently questioned the PTT plan and Prime Minister Abhisit Vejjajiva had stated that, per the national 2007 constitution, state companies cannot compete with private ones without justification.

“Since several interested parties of PTT have come to a conclusion we should not join the bid, PTT, therefore, has decided accordingly,” PTT said in a statement.

Related article:

- Carrefour retreats from Malaysia: govt

By Natalia Real
[email protected]
www.seafood.media

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