Project worth $10m seen as prototype for firm's first overseas investments
TTW Public Company is undertaking its first overseas venture in Mawlamyine, Myanmar, with an initial investment of US$10 million (nearly Bt320 billion) in what it hopes is the prototype project for developing tap-water and other systems in neighbouring countries.
Managing director Chaiwat Utaiwan, who has been with TTW for four months, said yesterday that the company was in talks with a local investor in Myanmar to develop the tap-water system in Mawlamyine, one of the country’s largest cities.
The investment cost is expected to be around $10 million, with initial daily production capacity of 30,000 cubic metres, though this could be expanded to 40,000 cubic metres.
TTW will make the investment through its subsidiary Thai Water Operations by holding 70 per cent stake in the joint venture, with the rest owned by a local investor.
Chaiwat said TTW was applying for an investment incentive from the Myanmar Investment Commission.
“As soon as we have been granted permission from the [Myanmar] government, commercial operation will be seen within 12 months,” he said.
The project will be on a build-operate-own basis instead of the initial plan for a build-operate-transfer model.
The company does not expect this investment to generate much profit but sees it as a prototype project to show the government that TTW could provide further services such as wastewater treatment.
TTW wants to expand into energy and eco-friendly sectors, and wastewater treatment is one of the businesses it wants to emphasise over the next few years.
Chaiwat said that the company had been approached by the Laotian government to help develop tap-water systems in that country.
“We are interested in acquiring an existing tap water [system] with daily production capacity of 20,000 cubic metres in Laos, which was developed by a Vietnamese company. This is expected to require an investment of about $8 million. However, we want to focus more on the project in Myanmar before thinking about the investment in Laos,” he said.
Tap water remains the core business at TTW, accounting for about 95 per cent of its revenue, he said when asked about the new vision of diversifying into energy and eco-friendly businesses.
TTW is conducting a feasibility study on getting into wind energy with a partner. Chaiwat said the yield from such energy ventures would be lower than from tap water, which is why it would keep that as the core business.
As for the eco-friendly sector, TTW will begin getting into this business once the government has carried out its infrastructure projects in the provinces, as it foresees water management and wastewater treatment becoming more important because of the urbanisation driven by those projects, he said.
For its tap-water business in Thailand, TTW is building a new plant in Krathumban, Samut Sakhon province, with daily capacity of 100,000 cubic metres, because an existing plan in Bang Len, Nakhon Pathom, is at full capacity at 380,000 cubic metres. The new plant in Samut Sakhon is meant to serve the rising demand of industrial customers as the economy recovers.
“We are reviewing the investment budget for the plant in Samut Sakhon. From the initial budget of Bt2 billion, it might go to between Bt2.5 billion and Bt2.6 billion,” Chaiwat said.
TTW will also expand daily production capacity at its plant in Pathum Thani province by 100,000 cubic metres at a cost of Bt300 million. That plant’s daily capacity is currently 380,000 cubic metres.
He said profit this year was expected to reach Bt3 billion, up from Bt2.6 billion last year, as both industrial and household requirements for tap water was expected to rise thanks to the economic rebound.