A study to bundle another two expressways as underlying assets of Thailand Future Fund's (TFF) second batch is expected to seek the cabinet's approval by February next year, says the head of the State Enterprise Policy Office (Sepo).
Laws governing the Highways Department are being amended to permit using the income stream of two brownfield projects -- Motorway No.7, stretching from Bang Na to Chon Buri province, and Motorway No.9, from Bang Pa-in to Bang Na -- to back TFF's second batch, said Prapas Kong-Ied, director-general of Sepo. He did not mention the second lot's fundraising size.
Offering TFF, an infrastructure fund, to the public is one way to lessen the government's burden in funding trillions of baht worth of big-ticket infrastructure projects.
Mr Prapas said Sepo is scheduled to go to Singapore and Hong Kong for road shows featuring the first tranche of TFF from Sept 17-20. Local road shows are scheduled from Sept 24 to Oct 8.
TFF's first lot, with a fund mobilisation size of 45 billion baht, is set to go public in the second week of October, with at least 60% of its units being offered to retail investors.
According to the cabinet's resolution, 45% of future revenue from the Chalong Rat Expressway and Burapha Withi Expressway, both owned by Exat, will be used to back TFF's first batch units.
The TFF initial public offering will be used to finance construction of the expressway linking Rama III Road-Dao Khanong and the Western Outer Ring Road, worth 30.4 billion baht, as well as the third stage of the long-delayed northern expressway linking the Kasetsart intersection and Nawamin Road, also known as the N2 section, worth 14.4 billion baht.
"TFF has high potential to grow in the future as the fund can make additional investment in government infrastructure projects such as expressways, airports, seaports and rail routes," said Chavinda Hanratanakool, chief executive of KTB Asset Management (KTAM).
KTAM acts as TFF's fund manager.
TFF's investment return depends on book building, which is expected to be completed later this month.
In related news, the Public Debt Management Office (PDMO) plans to borrow 1.16 trillion baht from the local market in fiscal year 2019.
Of the total, 592 billion baht is new borrowing and 571 billion is being rolled over, said a source at PDMO who requested anonymity.
The source said 450 billion baht out of the 592 billion in new borrowing is used to offset 2019 budget expenditure, 50 billion is to offset this fiscal year's budget, and the remainder is for re-lending to state enterprises.
The PDMO is expected to largely issue benchmark, savings and short-dated bonds.
According to its borrowing plan, the government bond supply will amount to 600 billion baht in total and it will unveil a new series of benchmark 20-year bonds.
PDMO has prioritised continuously issuing benchmark bonds to cover all maturities to be reference rates for investors, boosting trading liquidity in the secondary market.
Moreover, PDMO will offer a greenshoe option for the five-year benchmark bonds, and exclusively allow the Finance Ministry's outright primary dealers to participate in the five-year bond auctions and exercise rights to buy the over-allotment up to 20% of the original offer.
For savings bonds, PDMO plans to offer them to the public twice in the next fiscal year to encourage people to save.