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Business News





HEADLINES [click on headline to view story]:
Asia’s first ‘3-D factory eyes banking industry
ICC launches St Andrew brand
Orient Thai puts off domestic service plan
Mammoth paper mill project gets big bost
Dutch bank takes over Thai Capital
Microsoft to officially launch Office 2000 next month

Video Ezy plans ambitious expansion drive

Asia’s first ‘3-D factory’ eyes banking industry

Three-D Animation said it has invested more than Baht 30 million in establishing the first ‘3-D factory’ in Asia here, eyeing commercial banks as prime customers. Banks have been interested in making 3-D ATM cards. The new facility, with the capability to produce up to 100,000 pieces of 3-dimension pictures and other forms of computer graphics a day, will also serve the advertising industry.

The company will spend up to Baht 80 million more in expanding the ‘3-D factory’ later this year, said Yaowadee Leelalak, marketing manager of Three-D Animation Co. Amongst the company’s customers are the AGV and Imax movie theater chains. Three-D Animation is preparing to produce 3-D movie tickets for the two chains, she said.

The company’s products have a 30% share of the souvenir and gifts markets, while enjoying a 50% share of the outdoor artwork market.

A grand opening ceremony is planned for early September; Three-D Animation then plans to participate in AD Asia 99 in Pattaya in November.

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ICC launches St Andrew brand

ICC International Co. of Saha Group recently launched a new child-care line of products under the brand name ‘St Andrew’. The company hopes to tap into this huge market segment which has been under the control of foreign brand products. Adding to the bottles is Pooh the bear, to parallel Disney’s Little Mermaid cartoon in the same line of products by Colgate-Palmolive.

St Andrew products for children, especially those from three to ten years of age, include shampoo, liquid soap, and talcum powder. ICC products will compete directly with Johnson and Johnson, which is the market leader, Colgate-Palmolive, and Lion (Thailand), said industry sources.

Colgate-Palmolive recently launched a new shampoo and liquid soap with the Little Mermaid on the bottles. J&J products control 28% of the baby shampoo market, while shampoos by Colgate-Palmolive and Lion (Thailand), each share 20% of the market. Competition is expected to heat up again in the second half this year.

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Orient Thai puts off domestic service plan

Privately owned Orient Thai Airline Co. has scrapped its plan to restart its domestic service after only 4 routes, from a total of 10 applied for, have been approved by the department of aviation. Only unprofitable routes, with high competition, were approved.

The company is going back to Cambodia, where it partly owns Kampuchea Airlines, to develop its international chartered flight services. The airline will, however, keep its Thai flying license, even though it spent Baht 300 million in its domestic flying service here, which turned unsuccessful.

Udom Tantiprasongchai, managing director of Orient Thai Airline, said Kampuchea Airlines has been appointed by the United Nations to transport displaced Kosovo people from Australia back to their homeland.

Negotiations have been underway with authorities in Mostadonia, an autonomous region which borders Kosovo, for a US$10-million turnkey airport construction project there.

Orient Thai Airlines, which flew domestic flights 5 to 6 years ago, might come back again when the airline industry is truly liberalized in Thailand, Udom said.

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Mammoth paper mill project gets big boost

The Department of Royal Forests is prepared to sign a memorandum of understanding with a Chinese investment group next week to lease 200,000 rai of land in the east and the northeast for a eucalyptus tree plantation. The land lease is the key to implementing the US$1-billion paper mill project here, said Plodprasob Suraswadee, department chief.

The signing ceremony will take place during an official visit by China’s president Jiang Ze Min next week, Plodprasob said. The Chinese company, which at a later time would form a Chinese-Thai consortium to run the project, will also reforest about 100,000 rai of deforested land for the Thai government as a compliment, he said.

Much more eucalyptus wood will also be supplied by local farmers in about another 300,000 rai of land under a contracted farming system.

The paper mill, boasted to be one of the largest in Asia, will produce newsprint and paper sheets for industries. The paper mill is said to be the largest investment project outside China by a Chinese group.

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Dutch bank takes over Thai Capital

Rabo Bank of the Netherlands has offered a Baht 2-billion bailout deal to take over the ailing Thai Capital Finance. The deal has made for a narrow escape for the Thai finance house, which is among two or three finance firms reported to face closure by the ministry of finance because of inadequate funds, said a ministry source.

The bailout agreement was recently signed between the two sides, said the source. The Netherlands-based bank, which will own 100% in Thai Capital Finance, will inject fresh capital into the firm this September, the first lot among a few others, in a Baht 2-billion re-capitalization package, said the source.

Thai Capital is expected to raise enough funds set aside for its reserve under the re-capitalization plan to be completed in December this year.

The finance house, which is partly owned by the ailing Wattachak group, is expected to be among the best small-sized finance houses after the re-capitalization.

Note: Only Thai Samut Finance will be closed after its re-capitalization plan failed to get approval, while those of SG Asia Capital and Thaksin Thanakij get the green light from the Bank of Thailand.

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Microsoft to officially launch Office 2000 next month

Microsoft (Thailand) will officially introduce the Office 2000 business software in Thailand on September 24. The company has enjoyed 44% growth during the 1998-1999 fiscal year which ended June 30, in spite of the high rate of copyright violations in Thailand, said Peerapong Eusunthornwattana, managing director.

Though details are yet to be disclosed, Microsoft Office 2000 Thai version will be launched next month, Peerapong said. Sales of Office 95 and Office 97 packages have constituted more than 60% of the overall revenue, after Microsoft Thailand had offered the software to ministries and government agencies at a low price, 20% to 40% from the market price, he said.

Notes: The software piracy rate declined only 2% despite tough actions. Microsoft (Thailand) recently launched a new organization administration solution package for 2000 under the ‘Knowledge Management’ concept containing more than 17 applications.

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Video Ezy plans ambitious expansion drive

The Australian video rental chain Video Ezy plans to expand, aiming to compete with the Tsutaya chain, which will have 60 branches this year, after less than a year in the business. Video Ezy has opened 14 branches with more than 50,000 members over the past 5 months of operation, said Sarin Sukseree, a manager.

The number of Video Ezy chain stores will reach 100 by the end of 2000, Sarin said. There are already franchised stores, and there will be more in the chain, Sarin said. With full service and support technology from its Australian parent company, Video Ezy will no doubt be able to match the Tsutaya chain in the business, Sarin said.

Many of the 70 video rental stores under the Video 5 Group have joined Video Ezy. The chain also has its eyes on privately owned stores as potential business partners.

There will be no price cut to compete with the chain’s specialized package rental system, as Video Ezy stores will be in major cities nationwide with a one-price policy.

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Updated by Chinnaporn Sangwanlek.