Thailand's 'King Power' duty-free empire faces unknown after tycoon's death
30 October, 2018
The sudden death of billionaire Vichai Srivaddhanaprabha strips his King Power duty-free brand of its streetwise and connected frontman, challenging his heirs to secure the future of a monopoly that has become one of Thailand's most lucrative businesses.
Srivaddhanaprabha was Thailand's fifth-richest man when he died in a helicopter crash after watching his beloved Leicester City play on Saturday.
Over three decades he chiselled out a shopping empire now worth US$4.9 billion, according to Forbes, with success owing less to family wealth than a knack for winning - and then keeping - the favour of the Thai elite, gatekeepers to the kingdom's wealth.
That included the monarchy, in honour of whom he named his company and whose former king rewarded him with his lengthy royally-bestowed surname that translates as "auspicious and prosperous light".
The 60-year-old devout Buddhist led a family business defined by discretion and deft in diplomacy in a kingdom cut by bitter clan rivalries.
Biography of Vichai Srivaddhanaprabha, Thai billionaire and chairman of Leicester football club. AFP/Marimé BRUNENGO
That kept his family - and fortune - largely out of Thailand's courts and free from the clench of its bear-pit politics.
"He was neutral. He never messed with anybody's business," Thai political heavyweight and long-time friend Anutin Charnvirakul told AFP on Monday.
Srivaddhanaprabha leaves behind a wife and four children, two sons, two daughters all in their 30s - and all on the executive board of King Power.
They have so far avoided the scandals and legal woes which have dogged scions of other powerful Sino-Thai families such as the Yoovidhya 'Red Bull' family - Thailand's third-richest - and the Shinawatras, a political clan bankrolled by billionaire ex-premier Thaksin.
POLITICAL CONNECTIONS KEY
With Srivaddhanaprabha's passing, it is likely his children will step up to lead an empire that spans hotels, an English Premier League football club and a stable of thoroughbred horses.
"I believe Vichai has already groomed his children (for the leadership)," said Somchai Phagaphasvivat, a political scientist at Bangkok's Thammasat University.
The youngest son, Aiyawatt, a diminutive 32-year-old nicknamed 'Top', has the highest profile as vice-chairman of Leicester City, also fronting up the rare interviews granted by the family.
Soft-spoken and a gifted polo player, 'Top' has inherited his father's knack for modesty when in the public eye - sharing beers with workers at screenings of Leicester City games at King Power HQ in the denoument to their 2016 championship win.
Srivaddhanaprabha's daughters, Voramas and Aroonroong are also prominent in the company.
But a handover to his offspring is fraught with uncertainty.
"To be capable and competitive in Southeast Asia, political connections are very important," Somchai added.
"And I don't know if the siblings will have enough clout in those terms."
WOLVES AT THE DOOR?
Other storm clouds are on the horizon.
King Power's cash cow - a monopoly on duty-free sales in Thailand - is reportedly up for renegotiation at Bangkok's two biggest airports within the next few years.
The license was secured from the state-owned Airports of Thailand (AOT) in 2006, after years of lobbying.
It gifts King Power the captive market of the near 40 million people expected to visit the country this year, many of whom trawl through its duty-free stores at Thailand's international airports or downtown mega-malls in Bangkok and Pattaya.
Last month a court rejected an attempt to sue King Power for hundreds of millions of dollars in unpaid revenue to AoT.
That case was a rare pot shot by King Power's enemies. But without the shield provided by Srivaddhanaprabha, the family could be vulnerable to avaricious rivals and moves to break up their monopoly.
"King Power's most important business is based on a monopolistic concessionary right granted by the government," explained Pavida Pananond, an academic at Thammasat Business School told AFP.
"That suggests the political nature of the business and Khun (honorific) Vichai's political and business clout."
Whether his successors "move away from the 'know-who' to the 'know-how'" of the business will define how they parry potential competition, she said.
Among other assets, Srivaddhanaprabha leaves Leicester City in astonishingly good health - the club made US$118 million profit before tax in 2017.
His group bought the then Championship side for around 39 million pounds in 2010, clearing their debts and steering the unfancied outfit to a fairytale English Premier League title in 2016.
Srivaddhanaprabha also invested around £30 million in horse racing with a stable of 60 horses.
In a rare 2014 interview to Thai magazine Praew, Srivaddhanaprabha gave a flicker of insight into the advice he is likely to have shared with his heirs.
"No businessman just sits around and waits for others to give them concessions," he was reported as saying.