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Thai market has seen increasing private equity

transactions in which a hybrid of debt and equity funding
is provided to the portfolio company. This can be

evidenced from the recent practice of venture capital

firms which has shifted their interest in providing simple

equity financing through share acquisition to using

mezzanine financing as a means to invest in Series A
preferred shares of the portfolio company.

In this regard, it is worth noting that it is not legally

possible for a private limited company in Thailand to
issue a convertible bond, as it cannot have authorized

but unissued shares. In order to achieve the same

economic result, a private limited company may opt to

employ different legal forms and issue a synthetic

convertible bond to the private equity firm.

3.3 Participation in the Management of the Portfolio Company

As discussed in Paragraphs 2 and 3, private equity firm aims at

taking control over the management of the portfolio company
with a view to increasing its operation efficiencies and thereby

earnings and financial status. Therefore, it is essential for the

private equity firm or the SPV to acquire as many board seats

in the portfolio company as possible. In addition, to gain greater

control over the management, the private equity firm or the SPV
also strives to be appointed to the steering committee or

subcommittee of the portfolio company, and nominate the key

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