Srithai Food & Beverage has shut down its business permanently and laid off 144 employees, due mainly to losses from the impact of bird flu, competition and unsuccessful debt restructuring.

The company reported to the Stock Exchange of Thailand (SET) yesterday that it had already paid Bt6.4 million to laid-off staff.

The company announced a consolidated net loss of Bt134.34 million for 2006, down from a net loss of Bt189.61 million the previous year.

Srithai said in its statement that the spread of the deadly avian-influenza virus, especially in chicken and ducks, had heavily affected the industry, both in its breeding activities and production of frozen butchered chicken for export.

The company's trade partners have announced the prohibition of imports of frozen butchered chicken until the outbreak ends, and vaccination has been ineffective due to fear of the virus mutating.

Major importers such as Japan and the European Union only allow imports of limited volumes of frozen cooked meat under stringent conditions.

The company added that its operations incorporated the supply of young chicken, breeding and processed food from chicken, so the spread of bird flu has had a severe impact on business. Production is down to 70 per cent, due to the effect of the disease on purchases and price levels abroad.

Srithai said it had made efforts to solve the problems but the disease has not eased and the company's base is chiefly in the production of fresh chicken meat and semi-cooked frozen meat for export.

The company and its partners have not been able to adapt quickly enough, giving an advantage to competitors. That, together with the failure to get creditors' consent twice in debt-restructuring proceedings with financial institutions at the Central Bankruptcy Court, made it impossible to

proceed in the business, Srithai said.

"Therefore, the company found it necessary to close all business permanently from March 13, 2007, and we have advised our employees of this, with 144 employees to be dismissed with severance pay of Bt6.4 million.

However, our subsidiary, Srithai Food Product, will still operate," executive director Anan Jantaranukul said in the statement.

Earlier, Srithai, which is in the bourse's non-performing group, was warned by the SET that it was in danger of delisting, as it was found that its auditor has issued a disclaimer of opinion on the yearly financial statement for three consecutive years.

Last week, the company's stock was suspended because it failed to submit a financial statement for the first quarter this year.