One of the deal’s advisers said Temasek would need an additional Bt196 billion to complete the deal: Bt76 billion for the remaining shares in Shin and another Bt122 billion for AIS shares.

The deal was wrapped up after months of speculation amid rumours that Thaksin wanted to diffuse criticism of conflicts of interest allegations by his political rivals. Thaksin was quoted as saying to Shin executives two weeks ago that his exit was meant to soften persistent criticisms of his family.

Dr Suvarn Valaisathien, who represented the families, said at a press conference yesterday that the divestment was based on “pure business reasons.”

“The families think that the telecom business has demanded a great deal of investment,” Suvarn said, adding his clients would receive the proceeds on Thursday. Suvarn said the Shinawatra family had yet to receive the cash from the share sales so they had yet to work out what to invest their money in.

He said family members had no plan to buy back shares in any interests currently owned by Shin and that the money to be gained from the deal was not subject to income taxes.

The transaction signifies the Shinawatra family’s exit from the telecom flagship that Thaksin and his wife Khunying Pojaman co-founded in 1983. But telecom industrialists said it remained to be seen if the families could really cut ties with the telecom business.

At a meeting with over 200 executives of the Shin group of companies yesterday evening, Shin CEO Boonklee Plangsiri said the deal benefited three parties. While major shareholders could clear their names on the conflicts of interest issue, buyers gained access to the nation’s cream assets. Lastly, the group had no political attachments so its executives could be promoted for regional positions.

“No executives will be changed, except Khun Yingluck [Shinawatra, a sister of Thaksin who is president of AIS]. But she remains in her post,” he was quoted as saying. He also brushed aside the rumour that Shin would sell its stakes in subsidiary ITV Plc to GMM Grammy. “That’s entirely a rumour,” he said.

Aside from the shareholding changes, only three directors at Shin will be replaced. While Boonklee remains as a director, Pojaman’s brother Bhanapot Damapong, as well as Surasak Vajasit and Arak Chonlatanon, have resigned as directors. Replacing them are Pong Sarasin, S Iswaran, Temasek’s managing director for investment, and Wichit Surapongchai, president of Siam Commercial Bank.

Pong will also replace Bhanapot as Shin’s new chairman.

AIS president Yingluck Shinawatra said yesterday her resignation would take effect by the end of next month.

While quoting the price of Bt72.31 for AIS shares, against the market price of Bt104, the new buyers announced they would introduce no change to other subsidiaries of Shin, which include iTV and Shin Satellite Plc. iTV operates a TV station while Shin Sat operates satellites, both on concessions. Prior to the announcement, there was a public outcry that both companies would fall under foreign control.

Iswaran said there would be no major changes in Shin’s business direction and both Shin and Temasek executives would later discuss in more detail how to chart the future of Shin.

Contrary to rumours that the new Shin could sell some businesses back to the Shinawatra family, Iswaran insisted Temasek had no plans for such divestitures or to delist Shin from the Stock Exchange of Thailand.

“We have a long term commitment to the group,” Iswaran said.

The deal was wrapped up in a complicated manner. Joining hands with Temasek in the takeover were Siam Commercial Bank and a newly established Thai company Kularb Kaew Co Ltd. Kularb Kaew is owned 51 per cent by Pong Sarasin, former chairman of DBS Bank, and Thanachart Bank president Supadet Poonpipat.

The tender offer for Shin and AIS shares will start on February 2 and end on March 23.

The Shinawatra family’s exit from the telecom industry leaves the Chearavanonts, who own True Corp Plc which is a major shareholder in TA Orange, as the only Thai family remaining in the field.

The Bencharongkuls were the first Thai telecom family to seek an exit by divesting all their 40 per cent stake in United Communication Industry Plc to Norway’s Telenor last October.

Sigve Brekke, chief executive of Total Access Communication (DTAC), said DTAC did not have to change its strategies to cope with the entry of Temasek into Shin.

“We’ll continue launching new products and be very active in marketing, regardless of the shareholding change in Shin,” he said.

Iswaran of Temasek said he did not believe the entry of Temasek would spur fiercer competition in the industry.

“The Thai market has already been intensely competitive [even before Temasek’s entry],” he said.

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