Bliss-Tel informed the Stock Exchange of Thailand yesterday that it had signed a memorandum of understanding (MOU) of business cooperation with TG to jointly manage the distribution of telecommunication equipment and the exchange of necessary information. This will mean a greater ability to compete in the market and the chance to expand business opportunities in the future.

Bliss-Tel's joint managing director Prakaidao Kemachantree said yesterday that the three companies would discuss further collaboration within the next three months, hinting that that could include a share acquisition deal with TG.

Attavit Ektanitphong, also joint managing director of Bliss-Tel, said it was possible that small handset retailers might also join the group soon.

TG's general manager Pairoj Thavornsapanant said handset distributors needed to join forces to survive fierce competition.

"We'll also have greater bargaining power over handset suppliers and that will bring down prices," Prakaidown said.

Apart from IEC, Bliss-Tel and TG, other major handset retailers include M Link Asia Corp Plc, Samart i-Mobile and Jay Mart.

IEC, Bliss-Tel and TG have more than 700 retail outlets between them around the country and account for 53 per cent of sales by volume. Their combined revenue this year is forecast at Bt15 billion - Bt7 billion from Bliss-Tel, Bt5 billion from TG and Bt3 billion from IEC.

Bliss-Tel forecasts sales of 1.2 million handsets next year, with IEC and TG targeting 1.55 million and 720,000, respectively.

The trio also hopes to work together to cut combined costs of about Bt750 million this year to Bt600 million next year.

"While IEC will focus on inventory management, Bliss-Tel and TG will focus on handset sales. IEC will also concentrate on selling premium handsets, while Bliss-Tel will focus on fashionable phones and TG low-end phones," Attavit said.

The companies also plan to reduce staff numbers, Pairoj said, but he did not provide figures. Currently, TG and Bliss-Tel employ 550 and 800 people, respectively, while IEC has 300.

Prakaidao said that Bliss-Tel and IEC are also interested in becoming air time resellers in the future. The National Telecommunications Commission is currently drafting regulations governing such business.

Bliss-Tel's share price closed at Bt4.52 yesterday, down from Bt4.60, while IEC shares closed at Bt3.10, up from Bt2.76.

In the cross shareholding between IEC and Bliss-Tel, IEC will acquire 56 million shares from Bliss-Tel's four shareholders at a price of Bt4.5 per share (Bt252 million in total), which is equivalent to a 24.35-per-cent stake.

Of the 56 million shares, Singapore-based Network Management Solutions Pte Ltd is selling 35 million, Attavit 8.3 million, Chongkolnee Kemachantree 7.7 million and Prakaidao five million.

IEC will also sell 21 million new shares at a par value of Bt1 to three of Bliss-Tel's shareholders at Bt4.5 per share. This block of 21 million shares is part of the 784 million capital-increase shares approved by the company's shareholders on December 9, 2006.

The three buyers of the IEC capital-increase shares are Attavit, 8.3 million shares, Chongkolnee 7.7 million and Prakaidao five million.

Sumit Champrasit, IEC's executive chairman, said there were no plans to delist either IEC or Bliss-Tel from the SET.

Usanee Mongkolporn

The Nation