Thai retail giant Central launches record-breaking IPO
Thai conglomerate Central Retail launched the country’s largest-ever IPO giving it a market cap of around US$8.1 billion in a gamble on a sputtering economy now plagued by the coronavirus epidemic.
Every day, most locals in Thailand visit a shop owned by Central, a family-run empire that has hundreds of malls, electronics, grocery stores and 24-hour convenience stores throughout the country.
Shares in Central Retail Corporation (CRC) were proposed at 42 baht but made only a modest quarter baht increase in early trading, with the company eying fundraising of just over 71 billion baht (US$2.26 billion).
The company CEO, Yol Phokasub, said. “CRC is very proud to become the country’s largest IPO ever”.
The money raised will pay for “business expansion and stores’ renovation”, Mr Phokasub added.
Super wealthy and well connected, the company, established after World War II by the Sino-Thai Chirathivat family, has been on an ambitious spending spree, acquiring or partnering with luxury shopping brands in Italy, Germany and Switzerland.
The Stock Exchange of Thailand said the IPO has placed CRC among the 12 largest listed companies in Thailand.
Central already dominates the streets of Thailand but is desperate to make significant inroads into the booming online sales market.
In 2005, the group received a royal endorsement, a reward reserved only for the largest conglomerates by the unassailable palace of Thailand.
The big firms in Thailand are owned by Sino-Thai families, with deep connections, deeper pockets and a knack for navigating a country’s choppy political waters marked by coups and short-lived civilian governments.
They control businesses in a nation that once was Southeast Asia’s leading economy but is one of the least equal in Asia as it atrophies under a military-run government.
The economic outlook has also been clouded by drought, high household debt, the strong baht and now the effects of the deadly new coronavirus.
The Bank of Thailand has announced that next month it is likely to revise its GDP growth forecast to below two per cent, with tourism hammered by a slump in Chinese visitors.