Sea Horse has been instructed to respond by tomorrow.

In order to clarify its purchase of Boon Anake, Sea Horse has been asked to specify the names of the sellers, the number of shares and proportion sold by each seller and any relationship between each seller and shareholders, directors, executives and controlling persons of both Sea Horse and Boon Anake.

Earlier, Sea Horse reported that the company's board of directors had approved the acquisition of the ethanol producer for no more than Bt1.32 billion. The announcement came after a deal to purchase another alternative-energy producer, Power Energy, collapsed following an SET ruling that the transaction was equivalent to a backdoor listing.

The SET now wants Sea Horse to explain whether its board of directors, in making its decision to purchase Boon Anake, took into account a possible loss on impairment of lands amounting to Bt247.69 million. The SET has already cautioned about risks regarding the rights and locations of properties involved in the deal.

Sea Horse is required to explain how it can ensure that land purchased from Boon Anake is not inside a protected forest area and whether the Land Department has confirmed that all pieces of land are outside protected forestland.

Moreover, Sea Horse must say whether it has any loss-reduction policies in case the land is alleged to be protected forest area after an ethanol factory is built there. It must also specify the time frame in which the seller(s) of Boon Anake will buy the land back from Sea Horse.

Sea Horse is required to explain the reasons for two alternatives regarding construction and purchase of machinery for the ethanol plant by comparing the good and bad points of each alternative, including the time it has to consider the options.

The first option provides that the company is not subject to a payment of Bt35.7 million if Sea Horse negotiates directly with China Light Industrial and receives a better deal for foreign and technology cooperation than that offered to Boon Anake. The second option is that Sea Horse is subject to the Bt35.7-million payment if Boon Anake, on behalf of Sea Horse, negotiates an equal or better deal with China Light Industrial than that offered to Sea Horse.

The SET has also instructed Sea Horse to explain any interdependence between the sale of a 33.63-per-cent stake in Sea Horse by Vorajate Indamra to four shareholders of Boon Anake and Sea Horse's acquisition of Boon Anake's shares.

"Many newspapers have reported that Vorajate announced the sale of Sea Horse's shares to four investors, amounting to 935 million shares at Bt1 per share. Therefore, the SET requires Sea Horse to indicate the date and time that Vorajate, a director of Sea Horse, made that announcement, including a summary and whether there were any other directors or executives also making announcements," the SET said.