Bold Bets From Thai Billionaires Loom Big Debts

By IVCPOST Staff Reporter

Jun 10, 2013 12:46 AM EDT

Last year, a total of US$27 billion on acquisitions was spent by two Thai business tycoons. The amount was more than all Thai companies have spent abroad in the last three years.

The billionaires, Dhanin Chearavanont and Charoen Sirivadhanabhakdi characterize Thailand's bull market. They also personify Asia's frothy credit strengthened by a rising local currency.

On the other hand, the billionaires also represent financial risks rising within Thailand and in parts of Asia. This is due to signs of economic slowdown and the tightening over lenders in the markets. In a statement by Standard Chartered analyst Nirgunan Tiruchelvam, he stated that consumer growth needs to be robust as to justify the paid valuations for deals.

So far, Dhanin and Charoen look to be digesting acquisitions without any confronting issues. However, warning bells are ringing as high prices and heavy debt loads are being taken on. These loans are associated with real estate. The uneasy Bangkok Stock Market can swing sharply even with interest rates increase.

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