By: RATTAPHOL ONSANIT
(AP) A business tycoon close to Thailand’s prime minister on Friday abandoned an attempted takeover of a major Thai newspaper after critics protested that his acquisition threatened freedom of the press.
Paiboon Damrongchaitham, head of the Grammy entertainment conglomerate, had announced Tuesday that his group had acquired just over 32% of the shares in Matichon, giving it the largest single stake.
The news raised widespread concern, especially among journalists, as rumors circulated that Paiboon was acting on behalf of Prime Minister Thaksin Shinawatra, who is hostile to press criticism. Paiboon and his company have close business and personal ties with the Thaksin government.
In a joint statement issued late Friday, Grammy said it will cut its stake in Matichon to a maximum of 20%, and will sell the remaining shares to Matichon’s chairman and founder, Khanchai Boonpan, who holds the second biggest stake after Grammy.
Grammy will, however, secure a seat on Matichon’s board, although the timing of this hasn’t yet been decided, the two companies said in a statement.
Grammy Chief Operating Officer Sumeth Damrongchaitham, also Paiboon’s nephew, said the group wanted a good working relationship with the publisher.
“The reason that we dropped the [takeover] bid wasn’t the social opposition to the deal. It’s that if we are going to be part of a company, we need to coexist happily with existing shareholders,” Sumeth said at a joint press conference late Friday.
The minority holding would be sufficient for the company’s purposes, he said.
“We have operations in entertainment, and now we have some exposure to the news business. There could still be some synergy,” Sumeth said.
Matichon’s current management had vowed to oppose the takeover, which had raised the specter of a bidding war for the remaining shares in the publisher.
The Stock Exchange of Thailand on Friday morning suspended trading in shares of Matichon PCL, GMM Media PCL — the entity which acquired the Matichon shares — and GMM Media’s parent company, GMM Grammy PCL, because of negotiations over the deal.
After days of protests by journalists, civic leaders and activists, Matichon’s executives and supporters urged stockholders on Thursday to resist the takeover attempt, describing the acquisition as inimical to press freedom.
Prime Minister Thaksin’s relations with independent media have been strained by alleged manipulation of news coverage, cancellation of critical television and radio commentary shows, and through takeovers of media companies by his political and business allies.
Matichon is the most popular serious broadsheet and generally takes a liberal political line. The group also has several other publications, including the popular mass market daily Khao Sod.
GMM Media also bought 116.28 million shares this week in Post Publishing, giving it the biggest stake in the company with 23.6% of the shares. Post publishes the Bangkok Post, one of the two major English-language newspapers in the country, and the Thai-language Post Today. The Bangkok Post is a serious, upmarket newspaper, but is more conservative and less influential than Matichon.
Rattaphol Onsanit is a reporter for Dow Jones Newswires in Bangkok.