AIS chief expected to carry on in 2023

AIS chief expected to carry on in 2023

Lack of a succession plan indicates continuation for Mr Somchai

Mr Somchai is expected to continue his leadership role at AIS, even though his term is to end in less than 45 days.
Mr Somchai is expected to continue his leadership role at AIS, even though his term is to end in less than 45 days.

Somchai Lertsutiwong, chief executive of Advanced Info Service (AIS), is expected to continue his leadership role at the country's leading mobile operator for one or two more years following his scheduled retirement at the end of this year, according a source at AIS's parent company InTouch Holding.

An official announcement from the board regarding this matter could happen soon, said the source, who requested anonymity.

The source said Mr Somchai was presented with two options following his retirement: continue in his current role or become an advisor to the new chief executive.

There are less than 45 days until the end of Mr Somchai's term, but the AIS board has not yet begun the recruitment process for his replacement, said the source.

"Normally if there is a new chief executive expected at the start of a new year, the recruitment should have been completed by the third quarter to give the incoming executive time for a transitional period," the source said.

"This means Mr Somchai has accepted in principle the continuation of his current role at AIS."

The organisational structures of InTouch and AIS have significantly changed, especially after SET-listed Gulf Energy Development, the country's biggest private power producer by market value, became the largest shareholder of InTouch last year, replacing Singapore's Singtel.

Gulf now has a 46.7% stake in InTouch, followed by Singtel with a 24.9% stake. InTouch has a 44.5% stake in AIS.

Gulf indirectly owns 18.6% of AIS through InTouch, while Singtel directly owns 23.3% of AIS.

"A local capitalist now has an influence in the organisation's direction, much more so than in the past," the source said.

Mr Somchai declined to comment regarding his decision.


An industry source who requested anonymity said it is reasonable Mr Somchai would be chosen to continue in the driver's seat at AIS, which faces several critical issues.

The telecom business, which involves concession agreements, requires relationships with various parties, including the government, political groups, the military and customers, the source said.

Among the pressing tasks for the firm next year are its transformation into a "cognitive telco", or a smart telecom organisation, by 2024. The current year marks the first phase of its transformation.

Mr Somchai said previously the merger of its rivals True Corporation and Total Access Communication (DTAC) would change the telecom market landscape, with AIS needing to pursue its cognitive telco goal faster than originally planned to ensure it is one step ahead of its rivals.

Another key task is to pursue the acquisition of fixed broadband provider Triple T Broadband and investment in Jasmine Broadband Internet Infrastructure Fund for a combined 32.4 billion baht.

Once the deal is completed, AIS is expected to be the second biggest player in the fixed broadband market with a market share of 34%, trailing only True with a 39% share.

Some analysts believe the deal is aimed at strengthening AIS's business against its two major rivals, which are heading towards a merger.

The third major task involves a joint venture it established with Siam Commercial Bank (SCB) to make a foray into innovative financial services, especially digital lending.

The joint venture was announced in September last year.

The venture, called AISCB, has registered capital of 600 million baht and each party holds a 50% stake.

AIS indicated AISCB will benefit from low funding costs to provide loans.

AISCB has not launched service yet.

Finally, the mobile industry is facing declining profit margins, caused by strong competition and higher operational costs driven by increasing electricity prices, while people's purchasing power is dwindling.

Mr Somchai previously told the Bangkok Post the telecom operator needs to quickly adjust its operations and management to ensure cost reduction with improved efficiency to combat declining profit margins.

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