Who owns Loxley?By Bangkok Pundit Jan 06, 2010 8:00AM UTC
A company called Loxley GTech Technology signed a contract with the Thai government in 2005 to operate an “online” lottery (not on the internet as such, but up until now you can’t choose your numbers, you find a lottery seller with pre-printed tickets and buy them whereas with the online lottery you can choose your own numbers at a store). Prime Minister Abhisit Vejjajiva has stated that the government will basically cancel the online lottery. In response Loxley GTech has stated that it will sue the government for compensation as the Bangkok Post reports:
Loxley GTech Technology, which is a joint venture between Loxley and US-based GTech Technology, signed a contract with the Thaksin Shinawatra government in 2005 to set up an lottery system and install ticket vending machines.
Loxley GTech Technology CEO Trichakr Tansuphasiri said on Monday the the Thai-US partnership would demand at least 3 billion baht in compensation if the government cancelled the contract as it had already invested about 2 billion baht on online vending machines.
The project was initiated by former prime minister Thaksin Shinawatra in 2005 to curb the illegal underground lottery, but Mr Abhisit said he was not convinced the illegal lottery would be wiped out as a result.
Puea Thai Party MP Jatuporn Prompan said he seriously doubts that Mr Abhisit will actually scrap the online lottery, despite his announced intention to do so.
Mr Jatuporn, a leader of the United Front for Democracy against Dictatorship (UDD), accused Mr Abhisit of stirring up a story about ditching the lottery to divert attention away from the alleged corruption in the Public Health Ministry and the conflict between the Democrats and their coalition partners over the charter amendments.
In the end, the prime minister would not cancel the new lottery because the major shareholders of Loxley were the Chatikavanij and Lamsam families even though the firm is a public company, he said.
The stock market reacted as one would presume per Reuters:
Thai trading and telecoms group Loxley LOXL.BK said on Monday it could sue the government if the authorities scrapped a planned online lottery, after reports of such a move caused its shares to lose as much as 21 percent.
In case you think that Jatuporn has plucked those names out of thin air – actually one would be wise to fact check what he says – then have a look at BusinessWeek from 2000:
For four generations, members of Thailand’s Lamsam family have run their business empire the traditional way. The clan elders, ethnic Chinese who own Thai Farmers Bank and the Loxley industrial group, called the shots without much input from the hired help. To communicate with the top brass at Loxley, for example, nonfamily members had to penetrate a rigid hierarchy, using deferential memos cluttered with flowery Thai phrases. The layers of control helped the Lamsams retain a firm grip on operations and discourage anyone from taking risks that could rock the family business.
Today, Loxley is undergoing a cultural overhaul. Still chafing from debt accumulated before Thailand’s financial crisis, the group aims to use e-commerce to boost sales and cut costs at its chemical, trading, and consumer-products businesses. Building on its hot Internet service provider, Loxinfo, the group wants to develop Thai-language portals and do procurement online. And by using the group’s intranet, all employees can directly contact Chief Executive Dhongchai Lamsam and his cousin, Executive Vice-President Vasant Chatikavanij, using chatty English. Deference, caution, and stifling control are out. The new philosophy? “Try 10 ideas and fail at 7–that’s no problem,” says Vasant, 43, who has helped spearhead the change after studying and working for 14 years in the U.S. “We have to make sure we are not dead.
According to the Stock Exchange of Thailand, the main shareholder of Loxley is a private company called Ekpavee Co. Ltd with 28 percent. Below that you quickly move to those who own 1percent or less. There are quite a few Lamsams in there. There are four Lamsams on the Board. As Ekpavee Co. Ltd is a private company, it is hard to know who owns it, but a Panthip poster has checked the company details with the company registrar and again we find lots of Lamsams on the Board. It is difficult to say precisely, but by all reports and the list of directors, Loxley is under the control of the Lamsams.
For finance minister Korn’s extended family, the Chatikavanij’s, cannot find them as big shareholders. They certainly had filled a number of key positions. In addition to the current executive vice-president, the former chairman was also a Chatikavanij. The point of interest is that the Finance Ministry oversees the Government Lottery Office, but without more details of the shareholdings of the Chatikavanij in Loxley, it seems unfair to pin conflict of interest on Korn with him having a relative in an executive position in Loxley – given elite circles in Thailand, most have some family member somewhere.
NOTE: The conflict of interest with Korn may sound odd as the government is cancelling the lottery, but well if Loxley win big in court then… The problem is the appearance politically.
It is really the Lamsam connection which is of greater interest to BP. As noted above, the Lamsams also own Thai Farmer’s/Kasikorn Bank, one of Thailand’s largest banks. Pothipong Lamsam was a Democrat MP and former Deputy Minister, was last year a shadow Deputy Prime Minister and is now on the Board of the Democrats. His daughter, Nualphan Lamsam, is a former Assistant Secretary-General (money bags) of the party and is now a Deputy Minister. Another Lamsam, this time Banthoon Lamsam, the CEO of Kasikorn Bank was approached to run for the Bangkok Governor as a Democrat. He was also floated as a potential Finance Minister although that was always unlikely. The Lamsams do have plenty of money, but surely they must be a little annoyed with the Democrats? Then again, if they win big with a lawsuit, will we have talk of a conflict of interest?