Investors reap huge gains from PP share deals; SEC urges probe

[webfact]

Investors reap huge gains from PP share deals; SEC urges probe
The Nation

BANGKOK: -- Investors with deep pockets repeatedly bought private placement shares issued by six companies over the past few years - actions found to be linked to the alleged Solution Corner (1998) stock manipulation.

Meanwhile, the Securities and Exchange Commission has urged the Department Special Investigation to probe the SLC share manipulation case.

However, a security agency has closely monitored SLC's attempts to take control of media outlets, includeing Nation Multimedia Group, Spring

News, GMM Grammy and Tnews - as reported to Prime Minister Gen Prayut Chan-o-cha last week, a source said. The moves would not only be linked to domination of the media, but could be involved with politics, the source said.

Fundraising via private placement (PP) shares has been popular among listed companies over the past three years, raising a total of Bt434 billion, according to an investigation by Krungthep Turakij, a paper run by NMG.

The practice has been widely criticised over concern it could become a loophole allowing listed companies to increase capital by taking advantage of retail investors. Interestingly, it has been the same investors buying PP shares - some many times - over the past few years, the investigation found.

The paper found that some PP shares were linked with software and IT solutions provider Solution Corner (SLC), which acquired a 12.27-per-cent stake in NMG last month. SLC is being investigated by the broadcasting authority to determine if the deal violated the digital TV auction rule as the company owns channel SpringNews via a wholly-owned subsidiary.

The investigation also discovered that eight investors bought PP shares from more than three issuers and most of them are now holders of NMG shares, indicating that the investors might be connected.

The top-five investors in PP shares linked to six companies over the past few years have been identified as Bhanurak Saengaram, Thaweep Ruangrai, Raweerot Khiannilsiri, Nirandr Heatrakul and Treekhanit Maakraksa.

"Investors were found to have spent Bt300 million to Bt1 billion on buying PP shares," the investigation found.

The paper said the names of some investors disappeared once the shares were traded on the stock market, meaning that the investors likely sold the shares before they were listed.

"The SEC on September 9 last year gave the DSI all documents as evidence on manipulation of SLC shares that were found in unusual trading from March 31 to April 29, 2010," SEC general secretary Vorapol Socatiyanurak said.

"I want to ask the DSI director-general and Attorney General to oversee the case by themselves in order to have it done transparently and we should be aware of documents, as some of them might get lost."

Source: http://www.nationmultimedia.com/business/Investors-reap-huge-gains-from-PP-share-deals;-SEC-30251714.html


-- The Nation 2015-01-12

[jaidam]

Out of respect for the chief of police and his half billion nest-egg I will refrain from commenting on stock manipulation by criminal elements.

[Thai at Heart]

The process they describe sounds purely like money laundering.

You privately buy new issued shares from a corporation and then sell them onto the stock market. No one knows the price you paid

That sounds incrdibly dodgy.

[bassman]

The SEC of Thailand cannot "probe" or investigate, what does this organization do? Might be a good place for inactive posts!

[rickirs]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

The process they describe sounds purely like money laundering.

You privately buy new issued shares from a corporation and then sell them onto the stock market. No one knows the price you paid

That sounds incrdibly dodgy.

The purchase of privately-held company stock with the hopes of the company going public for profit purposes is in itself not money laundering.

It's cheap to start a company but expensive to scale it up because it depends on the personal wealth of its few investors. An IPO is a common way for a privately-owned company with limited capital to quickly accumulate large amounts of capital to provide substantial financial growth. High-tech companies are good examples.

There is a lot of financial risk in purchasing privately-traded stock. The odds of a company EVER being able to make an Initial Public Offering (IPO) are very low. Years may pass without private investors ever seeing appreciation in their stock holdings. Privately-owned companies are often just a step away from bankruptcy. And dividends? Forget about it!

IPO activity is a common measure of a nation's economic health. A country with little or no IPO's is a country with no financial future. Here is an example from Reuters:

Edited January 12, 2015 by rickirs

[JOC]

Out of respect for the chief of police and his half billion nest-egg I will refrain from commenting on stock manipulation by criminal elements.

The drug money from the islands has to be laundered somewhere!!

As for Khun Somyots nest-egg, the official (declared assets) is around 400M, but if you look into the shareholder-structure of companies like SLC, WAT, AQ and SAMART, the size of the inofficial nest-egg is probably around 2 billion baht!!

Handpicked by Prayut to fight corruption?? My backside!!

[spidermike007]

There is no fight against corruption. It is purely intended for PR. Have charges been brought against the CIB guys yet? Are they all being held in jail? Will they be tried? Will the govt. be able to get any convictions? Who else of real stature is being brought down?