Doing Business in Thailand

How much is the Elite Card Business worth? ThailandPrivilegeCards or TPC is worth two to three billion THB (60 to 90 million USD) if you believe the Finance Ministry estimation.

While I’m an incorrigible optimist I don’t see who would agree to pay 90 million Baht for a company which economic model is doubtful. Especially due to the fact that any buyer who would agree to pay 90 million USD to purchase TPC would also have to shoulder the current debt of 1,4 billion THB or 45 million USD.

In addition the buyer would have to deal with the current 100 workers employed by the company and eventually paid the severance pay of those of the employees he would not agree to keep.

Charoen Wangananont the spokesman of Thai Tourism Federation seems to agree with my analyses. For him ThailandPrivilegeCards is worth nothing and “there is no one to buy or take over TPC, because the company has no future”.

 Not only he does not believe in the success of the auction but he furthermore says that the alternative solution that is to say to transfer the Elite Members to the Tourist Authority of Thailand (TAT) in case the company cannot be sold will fail because the TAT is simply not equipped to run a business concern.

Instead, he proposes a solution which has the merit to be simple. Close down the company and reimburse the Members.

Of course closing the company and reimbursing the Members would cost a lot of Taxpayers money and I can understand that the Ministry of Finance may be reluctant to do so. But what the tourist professionals can see (and the Finance Ministry does not) is that Thailand reputation as a tourist haven has suffered a lot during the past two years and that a story like the Elite Card failure if dragged too long will only cause more damage to Thailand reputation.

About the Author:

The author Rene-Philippe DUBOUT is a lawyer since 1990 when he was admitted to Geneva bar (Switzerland). He practiced as a litigator there for 10 years until he moved to Thailand in 1999. In 2002 he founded with a group of Thai lawyers Rene Philippe & Partners Ltd a local law firm that specialized in Cross Borders Investments and Real Estate. He has been lecturing in several Thai Universities and a speaker to numerous conferences and seminars. He is the author of a must read book:”How to Purchase Real Estate Offshore Safely: The Case of Thailand”.

http//:www.renephilippe.com

 © Copyrights 2009 – Rene Philippe Dubout – This article may be reprinted if information about the author, the websites, and the URLs remain intact.

Originally posted 2009-12-17 11:11:58.

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