What ‘really’ happened and is happening between Thaksin Shinawatra and Sondhi Limthongkul? It’s a question overshadowed by the issue of media freedom and growing public disenchantment with a once-popular leader.
Is there more to the potentially explosive conflict between them than meets the eye? This is the first in a series of a comprehensive look into an intriguing showdown.
It’s not all about media freedom and democracy.
The conflict between Prime Minister Thaksin Shinawatra and media owner Sondhi Limthongkul is driven mainly by business interest as the latter lost his cash cow in the government’s corral before he started firing a series of salvos at his former friend.
The pair has had a long love-hate relationship. They are former business partners in telecoms firm International Engineering Company who shared everything. A deep rift led to deadly rivalry in telecommunications sector when Thaksin moved away to start out on his own.
Thaksin had mobile phones and so did Sondhi; when Thaksin launched a satellite, Sondhi wanted to as well.
That bout in the foe-cum-friend story ended with Sondhi knocking himself out.
Nobody imagined that when Thaksin began his first term as prime minister five years ago, Sondhi would be foremost among his flatterers. He called for people to give the new prime minister a chance to run the country after the Democrat Party, in his view, took foreigners’ orders to destroy Thai-owned business, including his own Manager Media Group. Sondhi himself had ended up with huge debts after the 1997 economic crisis.
Like a phoenix rising from the ashes, Sondhi got quickly emerged from debt thanks to a creditor who forced him to declare bankruptcy. This meant that the Bt1.5 billion debt could be claimed from whatever was in his personal account for a span three years, rather than having to repay the debt over 15 or 20 years as earlier scheduled.
The reborn Sondhi quickly got stronger with support from major players in Thaksin’s government, namely chief adviser Pansak Vinyaratn, Deputy Prime Minister Somkid Jatusripitak and Finance Minister Thanong Bidaya, as well as then Krung Thai Bank chief Viroj Nualkhair.
Sondhi began to build his media empire again using his son Jitranart Limthongkul as a front to set up the company Thaiday to run the Manager website, radio, television and an English language newspaper. The rehabilitated Manager Media Group meanwhile served as a good back office.
Business was shaping up well in the beginning. Sondhi managed to tap a frequency of Public Relations Department to run programmes on the Channel 11 News One channel. He got airtime from Mass Communication Organisation of Thailand (MCOT) to broadcast radio programmes and his TV talk show “Muang Thai Rai Sabda”. Many professional journalists, including his talk show co-host Sarocha Pornudomsak, flocked to Pra Arthit Road to help Sondhi build a new media empire for good pay.
The content of all his media outlets, notably the flagship Phujadkarn newspaper, favoured the Thaksin administration. Sondhi acted as the government’s public defender, justifying all Thaksin’s policies including the populist ones.
The honeymoon quickly ended as a faction in the ruling Thai Rak Thai Party questioned Sondhi presence in state-run media and forced him out. Airtime from MCOT was running out and the channel 11 News One slot was ruled irregular.
Sondhi’s fondness for the government was wearing thin and finally torn when his close associate Viroj, former chief of Pratara Finance who fed Sondhi’s business before 1997 crisis, failed to get a second term as president of KTB. Sondhi has been sniping at Thaksin ever since.
Sondhi has got intelligent advisers. He has never told the public that business interest was the driving force in his movement against Thaksin. In stead, he used royalist ideology as a moral high ground from which to accuse Thaksin of lese majeste.
Sondhi also latched on to Thai Rak Thai member Pramuan Ruchanaseeree’s disaffection with the party after the latter wrote a book championing royal power and calling for a second political reform and a new constitution.
The ultimate goal of this political movement is to overthrow Thaksin administration, as well as its allies in parliament and independent bodies. Legal expert Amorn Chantrasomboon was brought in to help Sondhi build a political discourse for the movement and the pro-democracy Thammasat University offered forum for them to run the game.
Despite being no good for the nation as a whole, Sondhi’s royalist rhetoric is actually working, as more and more people are showing up at his weekly meetings in Lumpini Park wearing yellow T-shirts with the slogan “We will fight for the King”.
But now that the mass movement has gained momentum, Sondhi will find it is a tiger that he cannot get off so easily. He needs to carry on until either the end of Thaksin’s regime or the collapse of his media empire. The game will not be over quickly as his opponent has everything, including power and money.
Disclosures about Thaksin’s abuse of power and conflicts of interest in the government gained credibility and political support for Sondhi, who also has the backup of support from Luangta Mahabua, a prominent Buddhist monk from Udon Thani.
But financial support might be a troublesome for Sondhi as all media outlets he employed to fight Thaksin ranking from old forms newspaper to new form such as internet and satellite TV is money consuming choice.
If the December 9 gathering does not deliver a knockout punch, Sondhi will need a full credit pipeline to enable him to stay in the game.The good old days
Thaksin Shinawatra and Sondhi Limthongkul were once considered the best of pals. The second part of our special series touches on the time before things started to turn sour.
Whenever Sondhi Limthong-kul talks about Thaksin Shinawatra, he cannot fail to be reminded of the IEC episode in 1992 that marked the first rift between the two equally daring and visionary personalities.
In his book, “One must know how to lose before knowing how to win”, Sondhi wrote that before taking his telecom company IEC public in 1992, he allotted a 17.5 per cent stake in the company to Thaksin, then a rising star in the telecom industry. Thaksin bought the stake at Bt10 per share.
After the listing, IEC’s share price shot up to Bt250 apiece and Thaksin did not hesitate to take a huge profit by selling his stake.
Sondhi said Thaksin made between Bt600 million to Bt700 million from the IEC float. He got the feeling that Thaksin was a free rider and did not want to do business with him.
Sondhi felt he had contributed greatly to Thaksin’s rise as a telecom tycoon. And following the IEC episode, Sondhi always believed he didn’t owe Thaksin anything.
Sondhi entered the telecom business over a decade ago by buying Siam Cement group’s non-core handset retailer and IT firms. He also ran a thriving publishing house through the Manager Group. Among the companies he purchased were the IT firms SCT and Micronetic, and the handset retailer IEC.
IEC was the exclusive handset retailer for Nokia phones and its major customers were the two rival mobile-phone groups Advanced Info Service, which belonged to the premier’s family, and Total Access Communication (DTAC).
During the economic boom in 1995, Sondhi also got into the satellite business, following in the footsteps of Thaksin. Thaksin founded the satellite operator Shin Satellite Plc, which in December 1993 successfully launched its first conventional broadcasting satellite Thaicom 1 into orbit.
The Manager Group-led Asia Broadcasting and Communications Network (ABCN) set up its satellite project, Lao Star Co – which was worth about Bt9 billion – as a joint venture with the Lao government in 1995. Lao Star appointed Space System/Loral to build two L-Star satellites and L-Star 1 was set to officially launch to provide digital direct-to-home TV programmes in 1998. L-Star 2 was to be put into orbit in 1999.
The project was planned to serve around 2 billion people in the Asia Pacific region, including India and China. Later ABCN enlisted DTAC’s parent, United Communication Industry Plc (Ucom), to back its business.
IEC also provided a bulk of the mobile-phone airtime to DTAC before purchasing the 1800-MHz frequency from DTAC to develop its own mobile-phone operator Wireless Communication Service (WCS). WCS offered the service under the brand Digital 01.
Then came the economic crash in 1997. Sondhi’s satellite and publishing businesses faced a meltdown. His WCS was sold to the CP Group before it was renamed TA Orange. His name was completely ruined.
In 1996, Fortune magazine had put Sondhi’s assets at US$600 million (or Bt12 billion at the exchange-rate of Bt25 to a US dollar). A year later, after the crash, M Group was saddled with Bt20 billion in debt. M Group’s holding company alone had liabilities of Bt6 billion. And Manager Media had Bt4.7 billion in debt.
Sondhi ended up declaring himself bankrupt for three years. But Thaksin and his Shin empire emerged unscathed from the crisis. Indeed he ended up the country’s wealthiest man.
Yet through Somkid Jatusripitak, now commerce minister, and later on Pansak Vinyaratan, the prime minister’s chief policy adviser, Sondhi began to re-establish ties with Thaksin. Somkid wrote a column for Manager, while Pansak was editor of the now defunct Asia Times, owned by Sondhi.
The Manager Group furiously attacked the Democrat-led government over its management of the economic crisis during its time in office from late 1997 to 2000. Thaksin founded the Thai Rak Thai party in 1998, which pushed itself as a saviour for the Thai economy under the slogan “think new, act new”. Thaksin’s team found that Manager an important ally.Sondhi was still licking his wounds. Creditors were after him and he was filed as bankrupt.
Yet “his people” marched into the Thaksin government in grand style. Somkid became finance minister. Pansak got direct access to the ears of the prime minister, acting as his chief policy adviser. And Chai-anan Samudvanija, who chaired IEC, won prominent jobs at the Krung Thai Bank and Thai Airways International. Kanok Abhiradee, the head of one of Sondhi’s companies, became president of Thai Airways and Viroj Nualkhair, who helped Sondhi with financing advice, became president of Krung Thai Bank.
Manager newspaper lauded Thaksin’s leadership, calling him Thailand’s best prime minister ever. Sondhi finally got his TV show, ‘Thailand Weekly’. He also invested in two TV channels, 11/1 and 11/2 – a split from Channel 11. And the debt that M Group owed to Krung Thai Bank was reduced from Bt1.8 billion to Bt200 million.
The start of the serious decline in Sondhi and Thaksin’s relationship was probably when the PM failed to protect Viroj last year. MR Pridiyathorn Devakula, the Bank of Thailand governor, threatened to sack Viroj if he did not resign after Krung Thai Bank was forced to reclassify some Bt40 billion as problem loans. The politicians were seen as having a nice party at Krung Thai Bank.
Manager furiously attacked Pridiyathorn, confident that Viroj would keep his presidency and Pridiyathorn would be brushed off. It was no surprise that Somkid, then finance minister, also backed Viroj staunchly – he had invited Viroj to take over as president of the state-owned bank. Somkid would also have liked to see the BOT chief sacked.
But Pridiyathorn went to see Thaksin at Government House and showed him important documents. After the meeting the PM tried to distance himself from the conflict between Somkid and Pridiyathorn, and Viroj eventually became the scapegoat, losing his KTB post.
Sondhi had also invested several hundred million in the TV business, which Thaksin later took away from him.
The PM also removed Sondhi’s ‘Thailand Weekly’ programme, which Sondhi co-hosted with Sarocha Pornudomsak.
This made it unlikely Sondhi would ever forgive Thaksin.
Sondhi has continued his ‘Thailand Weekly’ talk-show, holding it at Thammasat University Auditorium and in the open-air at Lumpini Park, and launched a kind of militant journalism, attacking the prime minister’s record and aiming to remove him from office altogether.This has heightened political tension. And heaven only knows how this episode will end, as the two friends-turned-foes look unlikely to make up.
via : the nation