03 Mar 2022
VGI to Spin-off Commercial Real Estate,
Completing the Jigsaw of O2O Marketing Solutions
VGI Public Company Limited’s Board of Directors has approved, in principal to spin off the lease rights to the commercial space on the BTS Skytain network to Nation International Edutainment Public Company Limited (“NINE”).
NINE, a company headed by experienced modern trade professionals, will bring laser focus to the task of repurposing and modernising
the commercial space on the BTS network. It has already concluded the repurpose of a pilot station, St. Louis station with excellent results.
“We are delighted by the initial results of Saint Louis station, where we were able to increase rentable area by approximately 100% and reformat the area with a more relevant customer offering” shared Nelson Leung, CEO of VGI.
In past years, the commercial rent from these spaces contributed only 10-15% of VGI’s revenue. It is anticipated that through a combination
of additional areas, a revamped service offering, a more cohesive space management strategy across all stations that VGI will grow see a 20% uplift in advertising revenue.
“This transaction is the last piece of VGI’s O2O Marketing Solutions jigsaw. Through NINE, VGI’s support for its customers or brands will span beyond its now nationwide O2O advertising business and utility services (payment and awareness) to include distribution. The combination
of our O2O Marketing Solutions, together with this premium commercial space to showcase products to our passengers, will be a very powerful tool for brands to raise exposure and sales. We will be able to offer our brands direct touchpoints with customers and greater insights to their preference” added Mr. Leung.
The transaction is subject to approval of NINE shareholders, who will consider the approval of a private placement of 984mn shares to VGI and other investors, and a rights offering of 240mn shares to existing shareholders. If fully subscribed, VGI will be the majority 60% shareholder and NINE will raise up to THB 4.0bn in new capital to scale the success across the BTS commercial network.
This is another landmark deal for VGI which follows hot on the heels of the successful partnership with and investment in Jay Mart Public Company Limited, as well as the investment in an Omni-channel e-Commerce service provider and the leading brand management
for Chinese brands, Fanslink Communication Company Limited.