DEAL: Thai liability management first

Author: Lizzie Meager | Published: 4 Sep 2017

Bangkok-headquartered PTT Exploration and Production (PTTEP) is the first Thai company to take advantage of local withholding tax laws with a unique liability management exercise.

State-owned PTTEP is the only Thai company in the Fortune 500

State-owned PTTEP offered to repurchase $1 billion worth of subordinated perpetual capital securities it sold in 2014, the first dollar corporate hybrids from Thailand at the time. It then sought consent from investors to lift a repurchase cap on the hybrid securities, and invited them to tender the existing notes for cancellation.

Thanks to a quirk in the law, if Thai companies issue securities via a so-called international headquarters – which then acts as a treasury centre – they can bypass the 15% withholding tax on interest payments. So PTTEP Treasury Center Company was established as a wholly-owned subsidiary of PTTEP,...



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