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Siam to sell glass venture for $16 million

Siam Cement of Thailand (SCC) is to sell its half-share in a joint venture glass business to its American partner for Bt 603 million (US$ 16 million).
The sale may reassure investors concerned at the…

Siam Cement of Thailand (SCC) is to sell its half-share in a joint venture glass business to its American partner for Bt 603 million (US$ 16 million). The sale may reassure investors concerned at the modest pace of the manufacturing conglomerate“s root-and-branch restructuring. The nine-year-old Siam Guardian Glass has two plants in central Thailand with a capacity to produce 260,000 metric tons a year of float glass and fabricated products for automobiles and buildings. About half the product is exported. Michigan-based Guardian Industries will own 100% of the company after the sale. The sprawling blue chip company – with more than 127 subsidiaries – said a year ago that it would shed its mostly joint venture peripheral businesses to concentrate on its core activities. These operations, which include cement, pulp and paper, and chemicals, account for some 70% of sales. Recently, Siam was forced to pull a US$ 645 million share issue, because of weak investor demand. This was in recognition not only of its heavy debt burden, but also of the increasing competition from more tightly focused foreign investors in Thailand. Total debts stand at Bt 200 million, half in foreign currencies, the company said. The sale of non-core businesses should eventually yield Bt 66 billion – most of which will be used to reduce the debt burden, said Aviruth Wongbuddhapitak, vice-president. Until recently, only six business interests had been sold – principally its automotive parts maker. The group added that it would invest Bt 6.86 billion to expand capacity at Thai Polyethylene and Thai Polypropylene, its ethylene units.

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