Thailand's Central Bankruptcy Court ruled yesterday that Thai Petrochemical Industry Pcl founder Prachai Leophairatana and China International Trust & Investment Corp can pursue their joint acquisition plan for Thai Petrochemical.

Prachai and CITIC can review company documents as part of plans to buy 75 per cent of Thai Petrochemical by paying US$2.7 billion to creditors of Thailand's biggest debt defaulter, the court said. Thai Petrochemical shares fell as much as 10 per cent.

The plan may override an agreement arranged by the finance ministry to sell Thai Petrochemical at a discount to State-controlled companies led by PTT Pcl, Thailand's biggest energy group. The court earlier set a November deadline for all bids, which doesn't leave Prachai and his partners much time to complete their proposal, said a lawyer representing Thai Petrochemical's largest single creditor.

"It could be more difficult for Prachai to complete his deal than for the current planners, who are further along in the process," Apichart Phankeasorn, a lawyer for Bangkok Bank Pcl, Thailand's biggest lender, said in an interview outside the court.

Prachai and CITIC "should be able to move ahead quickly" with their plan, Prachai told reporters outside the court after the decision, without providing a timeline.

"The market is disappointed with the latest development in the rehabilitation plan," said Visit Ongpipattanakul, a strategist at Trinity Securities Co. "The market expected PTT to gain control of Thai Petrochemical."

In his ruling, Judge Kamol Teeravetpulkul included conditions that due diligence be conducted without "trading secrets" being made public, and that it be "conducted without delay."

Prachai and other minority shareholders, who own about a quarter of Thai Petrochemical, have partnered with a Hong Kong- based unit of China International, a State investment group, in a bid to repay US$2.7 billion of debt to creditors and gain control of Thailand's biggest publicly-traded petrochemical maker. They have offered creditors 5.5 baht a share, compared with the State-backed proposal of 3.3 baht.

Thai Petrochemical has been under management control of the finance ministry since 2003 because it failed to repay creditors after the 1997 financial crisis.

CITIC Resources said in a June 2 statement completing the agreement it signed with Prachai on May 30 is conditional on the Thai court's approval and due diligence of Thai Petrochemical's business.

(China Daily July 5, 2005)