GSC: Going through a Back Door…?

After a long dealing with financial problem and defaulted debenture, Asia Capital Group Public Company Limited (ACAP) decided to dispose the assets of its subsidiary namely Global Service Center Public Company Limited (GSC), in the amount of 64% to Mr.Prayoon Asakan, at 1.00 baht per share, total amount of 159 million baht. The purpose of transaction is to increase liquidity of the company.

 

Interesting question is that…Why Mr.Prayoon would like to take over GSC?…And what will he do with this company…?  

 

As of present, Mr.Prayoon is a real estate entrepreneur under the company named Asakan Co. Ltd. and a property developer of projects such as The Rik, Asakan City and Asakan Place.

 

Asakan Co. Ltd. was founded in 2001 with a registered capital of 100 million baht. In 2016, total revenue of the company was at 213 million baht with a profit of 8 million baht. In 2018, Asakan reported an incomes of 223 million with a profit of 7 million baht and in 2019, the earnings was 85 million baht with a profit of 3 million…even the net profit likely continues to decline, but still recognise some profit.  

 

Is it possible that the reason behind this acquisition is to put on an Asakan shirt over GSC…? Well… to avoid the IPO process and automatically include on a stock exchange…by going through a back door.

 

GSC isn’t a company with an outstanding performance, in 2016, the revenue was at 135 million baht and the profit was at 24 million baht. In 2017, the total income was 151 million and net profit was 26 million baht. In 2018, the company posted a revenue of 153 million with a profit of 13 million baht and reported an income of 147 million baht with a profit of 12 million baht in 2019.

 

Lately, a 1Q20 was at 32 million baht with a core profit of 0.43 million baht.

 

The strength of GSC now is that it just listed on SET last year, thus the company still has a cash flow and ACAP has already made a repayment of promissory notes.

 

Interestingly, what shall be a strategy of this games….? Let’s keep an eye on Mr.Prayoon next move.