Court turns down petition by TPIPL creditors to stop debt discount plan

Court turns down petition by TPIPL creditors to stop debt discount plan
Published: 06 October 2005

The Central Bankruptcy Court on Monday dismissed a petition filed by 11 creditors of cement-maker TPI Polene Plc (TPIPL) opposing a plan to discount part of the company’s debts. 
 
TPI Polene is a subsidiary of Thai Petrochemical Industry Plc (TPI). The plan leaves it owing Bt2.7 billion in discounted principal and interest. 
 
Prachai Leophairatana, TPI’s founder, said in a statement following the court’s order that TPI Polene’s book value had risen to Bt3.46 per share, and TPIPL would be "legally capable" of paying debts to the 11 creditors. 
 
"TPIPL will receive a discount of Bt1.2bn in principal and Bt1.5bn in accumulated interest," he said. 
 
In another move on Monday, the court-appointed administrator of the parent company, Thai Petrochemical Industry (TPI), submitted to the bankruptcy court a request it be given the power to call a shareholders’ meeting when the company exits rehabilitation, in order to ensure a smooth transition of power to the new owners. 
 
The inability of the administrator to guarantee that the old board of the country’s largest debt-defaulter would not be able to interfere with the transition has threatened to derail a planned take-over of the company - in which a group of government-related investors led by oil and gas conglomerate PTT are to buy a majority stake. 
 
"We intend to file the request sometime on Tuesday," said Siri Jirapongphan, a member of the administrative team, at midday on Monday. 
 
PTT and its partners have signed a memorandum of understanding committing them to buy a 61.5 per cent stake in TPI by a deadline of November, but the state-owned oil company baulked at concluding the deal while questions remained about its ability to assume management control.