Public to get first crack at TFF's IPO

Public to get first crack at TFF's IPO

Sepo's IPO will finance three new expressway projects. CHANAT KATANYU
Sepo's IPO will finance three new expressway projects. CHANAT KATANYU

The State Enterprise Policy Office (Sepo) will apply a small-lot first basis for the imminent initial public offering (IPO) of the Thailand Future Fund (TFF) to enable more retail investors to invest in the infrastructure fund.

Under the small-lot first basis, retail investors will have the first right to buy TFF units and the remaining units will be allotted to institutional investors, said Ekniti Nitithanprapas, the director-general of Sepo.

However, it may set a subscription limit such as a maximum of 1 million baht each.

Selling to institutional investors is still essential as retail investors alone would not have the capacity to subscribe the entire IPO units of the TFF, Mr Ekniti said.

Retail investors may buy some 10 billion baht worth of IPO units, he said. The government envisions raising 40-50 billion baht from the first batch of IPO sales of the TFF.

The Finance Ministry has already submitted an IPO filing for TFF to the Securities and Exchange Commission. The 100-billion-baht fund is expected to go public in the next few months.

The plan is for three expressway projects to be used as underlying assets for the TFF. The three projects comprise two brownfields -- the N7 motorway (Pattaya-Map Ta Phut) and the N9 motorway stretching from Bang Na to Ayutthaya's Bang Pa-in district -- and a greenfield, an expressway linking Rama III Road to Dao Khanong.

A portion of the brownfield projects that generates 40-50% of each project's income will be bundled to the TFF, while proceeds arising from the IPO sales will be used to finance the construction of the greenfield project.

The cabinet in December approved the launch of the infrastructure fund TFF to raise cash from the public for the construction of state projects. The fund will also afford the government more room to invest in necessary infrastructure projects with lower investment returns.

Mr Ekniti said the TFF's IPO sales procedure will go before the cabinet in a couple of weeks.

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