PTT Plc, the national oil and gas conglomerate, is expected to find a partner by November to invest in new budget hotels located near its petrol stations.
Potential partners include three hotel management firms, said senior executive vice-president of oil business Auttaphol Rerkpiboon.
The move is part of PTT's business diversification plan to mitigate risks associated with global oil prices as competition in the non-oil and retail sector heat up, he said.
Mr Auttapol, who declined to name the potential partners, said the size of the hotels would be 30-80 rooms.
PTT has yet to decide whether to develop the hotels on its own land and use the partner's expertise in managing the hotels, or to jointly invest with the partner and seek out new hotel locations, which could be leased on a long-term basis.
PTT is considering having 50 budget hotels built near its petrol stations over the next five years, with each site requiring 2-3 rai.
PTT is still in the process of spinning off PTT Oil and Retail Co (PTTOR) to be a single unit and listed on the Stock Exchange of Thailand (SET). PTTOR's business is worth 122 billion baht.
PTTOR recently announced it delayed its plan to list on the Thai bourse from 2018 to 2019 because of the longer-than-expected asset transfer process.
He said many PTT assets are under rental contracts made with state agencies, requiring the transfer of assets to PTTOR to be done through the Private Investment in State Undertakings Act.
PTTOR needs to secure approval from the Public Private Partnership Committee to comply with the Act. Mr Auttapol said the proposal is still being considered by the Energy and Finance ministries.
Financial advisers for PTTOR's initial public offering will be selected after the assets are transferred. PTTOR has registered capital of 8.78 billion baht, with a par value per unit of 100 baht. The company will consider increasing its registered capital after the transfer is complete.
PTTOR reported total sales last year of 484 billion baht, down from 511 billion in 2015, while net profit rose to 16.1 billion from 9.9 billion.
Meanwhile, PTTOR yesterday signed a deal with the Bank of Agricultural and Agriculture Cooperatives on a project to make PTT's petrol stations community markets for agricultural products. The move is intended to increase the company's revenue and aid local communities. PTTP aims for 400 stations nationwide to be distribution centres for farm products.
PTT shares closed yesterday on the SET at 412 baht, up six baht, in trade worth 948 million baht.