By Amy Kazmin in Bangkok and Roger Blitz in London
Published: May 16 2007 18:54 | Last updated: May 16 2007 18:54
Thaksin Shinawatra, Thailand's exiled former prime minister, is close to making a formal bid for Manchester City, the UK football club, and is understood to have identified a new manager for the Premier League side.
An announcement from both parties is expected “within days” according to people close to the deal.
Bangkok’s media has been speculating as to whether Mr Thaksin, who was deposed in a military coup last year, would be able to release funds held in local banks. But it is understood that Mr Thaksin is funding the bid from private assets and has lodged monies for the bid with his financial advisers, to the satisfaction of Manchester’s board.
“It is there, they can see it,” one person close to the deal said. The club’s board members are also thought to be satisfied that Mr Thaksin has the right credentials for completing the deal.
Mr Thaksin, who built Thailand's largest telecommunications empire before entering politics in the 1990s, holds nearly all his publicly acknowledged wealth in Thailand.
Mr Thaksin's administration was overthrown in September, after a long political crisis triggered by his family's controversial $1.9bn, tax-free sale of their stake in Shin Corp to Singapore's Temasek Holdings.
Thai foreign exchange controls require investors to obtain central bank sanction to buy a foreign business – and Thais have been speculating over whether such approval would be forthcoming for Mr Thaksin to buy Manchester City.
Many Thais believe Mr Thaksin has undisclosed funds outside of Thailand, but Thitinan Pongsudhirak, a Chulalongkorn University political scientist, said if the former premier tapped those resources for the Manchester City purchase, it would leave him liable to charges from the Thai government. "They could accuse him of hiding money off shore," Mr Thitinan said.
Yet as ardently as they wish for Mr Thaksin to fade from view, obstructing his takeover of Manchester City would be a high-risk move for the coup-makers.
"The Manchester City deal is going to be a big dilemma for the Thai authorities, for the central bank, and for the military," said Mr Thitinan. "If there is a transaction, Manchester City will stand for Thaksin. If the deal falls through, people will have sympathy for him because he is being bullied."
Talk of the takeover is generating intense interest among football-crazy Thais, much to the chagrin of the coup-makers who are desperate to erase the ousted leader from the public consciousness. Mr Thaksin was involved in the dismissal of Stuart Pearce, the club manager, this week and is said to have been in discussion with a potential successor who is managing a club in continental Europe.
Copyright The Financial Times Limited 2007
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