CGD eyes B14bn projects

Construction News

After a backdoor listing last year, new property firm Country Group Development Plc (CGD) plans to invest almost 14 billion baht to develop two projects this year.

A huge investment of about 12 billion baht will be made to build the Landmark Waterfront Project comprising the five-star Capella Hotel with 101 rooms, the 73-storey Capella Residences Condominium with 352 units and the five-star Jumeirah Hotel with 305 rooms.

It will be located on a 36-rai site in Bangkok’s Yannawa district on a bank of the Chao Phraya River that formerly housed the Fish Marketing Organisation. The land will be leased from the Crown Property Bureau for 75 years.

The second project is the Elements Srinakarin condominium at a cost of 1.5 billion baht for construction and 300 million baht for land. It will be located on a 13-rai site on Srinakarin Road comprising 1,112 units worth 2.4 billion baht.

Managing director Ben Taechaubol said CGD plans to move to the Stock Exchange of Thailand and increase its capital by 3.7 billion baht, making its total registered capital 7.5 billion. The funds will be used to acquire assets of Landmark Development Group.

The Taechaubol family will take the biggest part of the capital increase, with its stake increasing to nearly 50% from about 20%.

The company will meet requirements of the SET in terms of capital size by transferring its shares to the SET when everything is completed, which is expected to be in the middle of this year.

“To fund the projects, we will use project finance from financial institutions with a target debt-to-equity ratio of not higher than 1.5 times,” Mr Ben said. “Now we have zero debt and 250 million baht in cash, enough to start up development.”

As at the end of December 2010, CGD had an accumulative loss of about 400 million baht but it has no plan to clear it this year. Its only source of income is from two subsidiaries _ A Host, a distributor of US-based software Oracle and Mobiscience, and an IT service company _ which generated combined revenue of 300 million baht last year.

It expects to generate revenue from its property business from next year after the Srinakarin project is completed.

According to the SET’s report of March 1, Komol Jungrungruangkit holds 5.1% of CGD shares, up from only 0.21%.

CGD took over IT firm Dragon One from Jarat Plingklasai last year and renamed it Country Group Development.


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