BANGKOK – Thailand’s King Power Group, the nation’s largest duty free retailer, said it plans to spend 12 billion baht ($340 million) on buying the remaining 60 percent of Asia Aviation Pcl.
King Power’s chairman, Billionaire Vichai Srivaddhanaprabha, and his family announced on Monday they had bought a combined 39.82 percent stake in Asia Aviation for 7.95 billion baht.
Asia Aviation is a major shareholder in Thai AirAsia.
The purchase should help Vichai’s King Power to strengthen its tourism-related business, analysts said.
King Power CEO Aiyawatt Srivaddhanaprabha said on Tuesday that the purchase represents new business opportunities.
King Power will join forces with Thai AirAsia to expand its distribution and retail business, he said.
Vichai’s net worth has risen by 30 percent this year after Thailand’s tourist traffic rose to 30 million visitors in 2015 and his Leicester City football club made sporting history by recently winning the English Premier League Championship, according to Forbes magazine.
Vichai’s group is required to make a mandatory tender offer to buy Asia Aviation shares it does not already own, the company said in its statement on Monday.
Thai AirAsia said in a statement on Tuesday that it wants to expand in markets in Southeast Asia, China and India. It reiterated its target to fly 17 million passengers this year, up from 14.85 million in 2015
Before the sale, the Thai management had a combined 45 percent of Asia Aviation, with the rest held by the public.
Asia Aviation, the Thai partner of Malaysia’s AirAsia Bhd, has a 55 percent stake in Thai AirAsia, the country’s largest budget airline with market share of 28.5 percent at the end of 2015.
By Khettiya Jittapong; Writing by Amy Sawitta Lefevre; Editing by Edwina Gibbs and Jacqueline Wong – REUTERS