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October 30, 2025

Contested Control in Thailand: Why Boards Stay Put (and What It Means for Tender Offers)

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Recent events at a Thai listed company, where a proposal to remove the director was not successful, amid claims that a competitor was attempting to gain control of the company, illustrate how disputes over corporate control can unfold differently at the board level and shareholder level. At the board level, removing directors of a listed company mid-term to gain corporate control is not an easy task under Thai law, as it requires a higher threshold than appointing a new director, which typically only requires a simple majority vote in a listed company. At the shareholder level, Thailand’s tender offer and competition regimes add complexity where different shareholder groups act in concert to remove opposing board representatives or otherwise influence control.

In this article, we will explore why the attempted removal of a director may fail, and how the tender offer regime may apply.

Key Issues at a Glance

Shareholder groups may seek to convene meetings to propose changes to board composition or company authority. Such proposals can be delayed or complicated by regulatory requirements and the need for additional disclosures.

Regulatory authorities and minority shareholders may raise concerns when major shareholders coordinate to influence board control, especially if such actions could trigger tender offer or merger control obligations. Companies often respond by seeking further information on shareholder relationships and potential conflicts before proceeding.

Why the Director Removal Failed

Under Section 76 of the Public Limited Companies Act B.E. 2535 (as amended), the early removal of a director requires two conditions to be satisfied at the same meeting of shareholders:

  • Headcount test: At least 75% of shareholders attending and entitled to vote must vote in favor. If multiple shareholders appoint the same person as proxy, each proxy is counted as a separate head for the purpose of the headcount test, even if only one authorized person attends and holds all such proxies (e.g., 10 proxies to one person count as 10 heads).
  • Sharecount test: Votes in favor must represent not less than 50% of all shares held by shareholders attending and entitled to vote.

In the recent case, even though the sharecount test was satisfied (approximately 80% of shares voted “for”), the headcount test failed (most shareholders present voted “against”). Because both conditions must be met simultaneously, the removal did not carry, and the director remained in office.

From Boardroom to Ownership: A Lead-in to Tender Offer Rules

A valid shareholder vote to alter board composition does not, by itself, trigger a mandatory tender offer under Thai law. Instead, a mandatory tender offer is triggered when the voting rights of any person — alone or together with persons acting in concert or persons under Section 258 (basically its related persons) of the Securities and Exchange Act B.E. 2535 (as amended) — reaches or exceeds 25%, 50%, or 75% of a listed company’s total voting rights.

In the context of unrelated parties — meaning those who are not part of the same group company but work together to gain control of a listed company — the concept of “acting in concert” is crucial. Acting in concert means that if people coordinate their actions with the intention to vote in the same direction or to influence the company’s direction, they may be treated as a single group. If this group’s combined voting rights reach or exceed 25%, 50%, or 75% of the listed company’s total voting rights, they are required to make a mandatory tender offer, even if no individual alone reaches these thresholds.

Allegations of control-seeking without a tender offer also invite regulatory scrutiny from the SEC regarding conduct and disclosure, potentially affecting the timing and posture of any subsequent offer. Separately, competition law considerations may require clearance where effective control by a competitor is in play, even where no mandatory tender offer obligation arises.

Could an Offer Still Proceed — and What Might Get in the Way?

Before acquiring shares or deciding to act in concert, parties should carefully consider whether their actions may trigger a mandatory tender offer or whether a voluntary tender offer is appropriate. However, several practical hurdles may arise:

  • Acting‑in‑concert exposure: The characteristics of acting in concert must be thoroughly reviewed to avoid unintentionally reaching thresholds that require a mandatory tender offer. Launching either a voluntary or mandatory tender offer requires strategic planning and a clear understanding of the regulatory implications.
  • Pre‑offer conduct and disclosure: Making a tender offer requires compliance with the Thai SEC’s filing and disclosure requirements, including submission of prescribed forms and publication of offer details. Offer documents must be complete, accurate, and consistent, and must be promptly harmonized to ensure fairness. Questions concerning nominee affiliations or potential conflicts are likely to receive heightened regulatory scrutiny.
  • Minority fairness: Conflict-of-interest or competitor-control concerns may invite closer review of equal treatment and opinions of financial advisors. An offeror must ensure that minority shareholders have an equal opportunity to dispose of their shares at the same acquisition price.
  • Merger control: When an acquirer is a competitor, merger control clearance from the Trade Competition Commission of Thailand may be required. Launching a tender offer without a credible path to clearance risks delay and uncertainty.

Navigating corporate control, especially in a listed company, under Thai law involves intricate legal considerations. For specific situations and tailored advice, we strongly recommend consulting with experienced legal advisors.

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