After a struggle lasting six years, young executive Sittichai Leeswadtrakul has revived his family's defunct steel business, achieving a remarkable Bt3 billion in sales last year.

Born into the Leeswadtrakul family and groomed to run the family steel business, Sittichai now plans to list his own company, Mill Con Steel, on the Thai bourse this year.

"The company needs about Bt300 million to strengthen its financial status," he said.

When the financial crisis of 1997 broke, Sittichai had just received his master's degree in engineering management from the University of Warwick in England, and he had to rush home to Bangkok to help his family's steel company. Like many others at that time, the family business was undergoing a debt restructuring of billions of baht. After the restructuring, all of the machines and steel plants in Bangkok were assessed for debt repayment. "Everything fell to ground zero, even the family house," Sittichai said of those days.

However, the new graduate refused to accept defeat and instead thought up a way to build a new business empire. He started his own company by buying back some assets of his family's steel plants with hot money of nearly Bt700 million from Thai Asset Management Corp.

As the eldest brother, he had no choice but to help his father shoulder the burden. "Apart from this, I was eager to have my own business," said Sittichai.

"Luckily, my father still had good credit and a helping hand from my uncle, Somsak Leeswadtrakul," he added, referring to the steel-industry tycoon.

Mill Con Steel, therefore, emerged in 1998 with paid-up capital of Bt100 million and 70 employees. Besides being the founder of the company, Sittichai was also in charge as managing director.

A few years later, a rise in world steel prices automatically pulled his business up. In addition to the same steel sales agents that his father had, Sittichai handled his own marketing by seeking new agents to expand sales. He also expanded his company's production line from structural steel alone to steel bars.

Now, Mill Con Steel produces both main types of steel with a combined full capacity of 500,000 tonnes a year. The company has paid-up capital of Bt300 million, assets worth Bt1 billion and a staff of 400.

Sittichai named financial management as the most difficult task, followed by human resources. "It's so difficult to get old and new workers to create a new corporate culture together," he said, adding, "Since I'm also younger than other workers, this was also a hurdle."

Sittichai wants Mill Con Steel to progress continuously. In the first stage, he plans to list the company's shares in the Thai stock market this year. The company is now preparing a readiness report, with the help of Seamico Securities in the role of financial adviser.

Proceeds from mobilising funds will be used to for repayment of all loans, or as much as possible, and for working capital, said Sittichai. The company now has an interest-payment burden of Bt50 million per annum.

"We don't need money for more production plants, although we still have room for expansion," he said, adding that Mill Con Steel needed to lower its debt-to-equity ratio as far as possible. The ratio in the first quarter was less than 1.

For the next step, Sittichai wants his staff, especially at the managerial level, to exercise positive thinking as the key to business success in the future.

"Once the company is strong, it can expand its business both horizontally and vertically," he said.

Sasithorn Ongdee

The Nation