Sep. 28--The SET-listed developer Sansiri Plc plans to double its registered capital to 12.612 billion baht this year by issuing new shares, says president Srettha Thavisin.

The move will support its expansion plans and raise its appeal among foreign investors, he said.

The issue of 1.473 billion shares will be offered on a private placement (PP) basis with a par value of 4.28 baht apiece.

The company's paid-up capital will increase to 12.612 billion baht from 6.307 billion. Sansiri will also issue 736 million free warrants for existing shareholders leading to a rise in paid-up capital to 15.766 billion baht, he said.

The company will propose the scheme for shareholders' approval on Nov 6 and Mr Srettha expects Sansiri to raise the funds by year-end after the approval.

After the capital increase, the company's debt-to-equity ratio will fall to 0.8 times from 1.2 times. The company expects about 70 percent of the PP shares will be sold to foreign institutional investors.

The funds raised will be used to support business expansion.

Sansiri plans investments of 17.5 billion baht next year in land plots and project development. The company targets buying about 30 land plots worth 8.5 billion baht.

Sansiri plans to introduce 18 projects worth a total of 22 billion baht in 2010 -- 10 condominium projects, six detached-house estates and two townhouse developments.

The budget for overseas expansion for next year has yet to be finalised. After a recent expansion to London this year, Sansiri hopes to enter Vietnam and New York next year.

In addition, Sansiri's market capitalisation is expected to rise to $500 million from $220 million after the capital raising with liquidity of about $1-2 million per day. Its market capitalisation was 6.87 billion baht as of yesterday.

"This should help increase our market cap to make it attractively big enough to lure foreign investors," he said.

"The Thai property market is being driven by banks' lending, which is expected to be tightened for the next couple of years, putting a limit for small and mid-sized developers. The capital market is a good financial source and raising capital will help to put us in a stronger position in negotiating with banks."

Business expansion is also expected to help lift the company's credit level and reduce financial costs.

The company next week will hold a solo, non-deal roadshow arranged by the Union Bank of Switzerland to meet with more than 100 foreign funds in Europe, the US, Singapore and Hong Kong. Sansiri will present its business plan and outlook on Thailand's property market.

Sansiri currently has a pre-sales backlog of nearly 18 billion baht, which should be realised in the next three years.

Sansiri shares (SIRI) closed yesterday on the Stock Exchange of Thailand at 4.80 baht, up 14 satang, in trade worth 89.12 million baht.

-----

To see more of the Bangkok Post, or to subscribe to the newspaper, go to http://www.bangkokpost.com.

Copyright (c) 2009, Bangkok Post, Thailand

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

SIRI,

A service of YellowBrix, Inc.