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Thailand's empire-building tycoons

Cashed-up execs are snapping up everything from delis to department stores abroad

BANGKOK During Thailand's boom years, between 1986 and 1996, business owners didn't have to look far beyond their own national borders to guarantee healthy profits. Growth nationally ticked along at 7% and the country's burgeoning middle class proved a big enough market to keep sales buoyant. For the past 20 years, however, Thailand's economic rise has stuttered, so company heads have increasingly looked abroad for new customers.

Luxury retailers in the West will be familiar with the sight of wealthy and elegantly dressed Thai shoppers loading up shopping baskets. But they might not be used to Thai tycoons buying up the shop itself. This is exactly what Central Group, Thailand's biggest retailer, has done for the past six years: acquiring some of the world's most iconic department stores and amassing a European empire straddling Milan and Munich. Since he became CEO in 2013, Tos Chirathivat has continued the drive into new markets and focused closer to home on vibrant Vietnam.

Another company that's been on spending spree -- this one for 20 years -- is Thai Union, one of the world's biggest seafood producers. Last year Thiraphong Chansiri, its president and CEO, hauled in Red Lobster, the world's biggest seafood-restaurant chain. He had previously reeled in some of the world's best-loved canned-fish brands: the U.K.'s John West, Norway's King Oscar and Germany's Rugen Fisch.

Then there is Pace Development. The company has demonstrated huge ambition at home -- it built Bangkok's tallest tower -- but CEO Sorapoj Techakraisri has only dipped his toes in foreign waters. With his 2015 purchase of New York-based deli chain Dean & DeLuca, Sorapoj made a splash globally and became the latest addition to the ranks of acquisitive Thai business owners.

In this report we meet these three extremely rich men, two of whom have built up huge portfolios abroad and one who is snapping at their heels.

Tos Chirathivat, CEO, Central Group (Benya Hegenbarth)

THE BORN RETAILER Dressed in an understated navy-blue jacket, Tos Chirathivat, 52, cuts an unlikely figure as the patriarch of a multibillion-dollar Thai retailer. But as the third-generation CEO of the sprawling Central Group, he has guided the business to new heights and new markets.

Like many in his family, Tos lives and breathes retailing, whether he is enthusing about a new opening in northeast Thailand or the audacious acquisition of one of Europe's oldest department stores. We sit with him in the executive lounge of the group's costliest hotel, shopping and entertainment complex: Central Embassy in midtown Bangkok. The soaring structure houses Thailand's first Park Hyatt hotel, which opens in May, alongside specialty shops and restaurants.

Although the youngest of eight siblings, it was the Western-educated Tos who replaced his uncle as CEO in 2013. He is now driving the expansion of a multifaceted $8.1 billion retail empire that began with a single shop founded by his grandfather, Tiang Chirathivat, in 1927. That expansion has seen the group make a string of acquisitions in Europe and Asia in the past decade, as well as grow rapidly in its domestic market.

In Thailand the group's network encompasses hundreds of retail outlets, from megasized department stores to local supermarkets in every major city. This has been complemented by rapid overseas expansion involving more than $2.1 billion in acquisitions since 2011. Outside of Thailand the jewels in Central's crown are iconic European shops La Rinascente in Italy, Illum in Denmark and a treble in Germany: Kadewe in Berlin, Oberpollinger in Munich and Alsterhaus in Hamburg.

The group is also bolstering its presence in its own region. Last year it bought Vietnam's thriving Big C supermarket business, adding to the 49% stake it acquired in 2015 in electronics chain Nguyen Kim. Then there is the establishment of a department store operation in Indonesia and the building of a shopping plaza in Malaysia. Central also recently bought the Thai and Vietnamese operations of online fashion retailer Zalora. The message is clear: Thailand remains the core but Tos wants foreign operations to grow, targeting 40% of group revenue, up from the current level of slightly over 30%.

Tos is also keen to develop online, which is going to involve a combination of cutting-edge digital strategies for internet sales and promotion with old-fashioned retail traditions. He believes that this is necessary in the current atmosphere: "The department-store format is transforming around the world with new technologies. Retail as we know it will change totally."

The group's drive to leverage digital business spurred an overhaul of top management in 2016, breaking Central's tradition of filling nearly all top positions with family members. The team now features both foreign and local executives drawn from sources as diverse as Thailand's Siam Commercial Bank, management consultant McKinsey and Coca-Cola.

The unlisted family structure is still a key characteristic. Tos's father was one of 26 children, so Tos has more relatives than he can easily count, with more than 60 connected to the company. "A family business has many advantages," he says. "People prefer long-term partnerships in terms of leadership, ownership and direction. If we run our business professionally as well, it's a perfect combination."

Within Thai business circles the Chirathivats are known for playing to win, but they can also accept a loss. The group bet heavily on China but admitted defeat in 2015. In a society where mistakes are often buried it is a sign of Tos's mettle that he acknowledges the experience: "We failed in China. We've closed everything. We won't go there again."

Failure is not something he has to live with often. Revenue for 2016 is expected to rise about 20% year on year to top $9.1 billion. Much of this is down to the group's unchanged formula for success. "My grandfather and father grew our business with two simple ideas in mind," says Tos. "Deal honestly with people and work hard to give customers exceptional products and services."

THE SEAFOOD KING Thai Union might not be a household name in the West, but many homes in the U.S. and Europe have its products in the pantry. A 20-year buying spree has filled the Thai company's cupboard with such supermarket seafood staples as Chicken of the Sea of the U.S., Petit Navire of France and John West of the U.K.

Thiraphong Chansiri, CEO, Thai Union (Photo by Christopher Wise)

This catalog of global brands appears on a sign outside the company's office tower in Bangkok. "All suppliers dream of having their own brand," says Thiraphong Chansiri, who took over as CEO from his father in 1994 and transformed the tuna supplier into a multinational company.

From his office on the 17th floor he has set his management team the goal of becoming an $8 billion a year company by 2020 -- more than double its revenue in 2015.

This "ambitious but achievable" sales growth will rely on several recent overseas acquisitions, for which the canned-tuna producer has had to look beyond its usual tackle box. Its latest U.S.-based acquisition was Red Lobster, a global chain of more than 750 seafood restaurants.

Thai Union paid $575 million for a minority stake -- a cautious step while Thiraphong decides whether to buy the business outright.

"Personally, I don't like the restaurant business because it is completely new to us," says Thiraphong. "But Red Lobster is the world's largest seafood-restaurant chain and we've known the management for more than 20 years." In this respect the investment is typical of Thiraphong. Chicken of the Sea, which Thai Union bought out of bankruptcy in 1997, was also well-known to him. "Chicken of the Sea was my main customer, so when we lost our largest account I had to find a way," he says.

From the beginning of Thai Union's buying spree two decades ago it has been more corporate savior than corporate raider. After it acquired France's MW Brands for $833 million, netting John West and Petit Navire as part of the deal, the French ambassador presented Thiraphong with the Legion d'honneur. "We're not private equity, we are not a hedge fund," he says. "We are a seafood company and this is our life."

With its origins 40 years ago as a supplier of tuna to U.S. canning companies, Thai Union was destined to be an international business: Canned tuna is largely a Western product with few Asian consumers. Today, more than 90% of its sales originate outside of Thailand. That said, the company has added to its status as the world's largest canned-tuna company; its frozen-products business is now the largest contributor to company revenue, and it is developing a higher-margin line of pet foods. Product diversification has prompted a fresh look at fast-growing regional economies in the Middle East and Asia.

Operating in both European and U.S. waters makes the business more complex. These two markets prioritize different aspects of the industry: The U.S. pays more attention to labor rights, whereas Europe is more focused on fishing methods. Thai Union covers every aspect, but it hasn't always been smooth sailing. In 2015 it became embroiled in a scandal when an investigation exposed slave-labor practices at one of its suppliers. All processing was subsequently moved in-house and the company received awards last year for its efforts. Greenpeace, however, is on the company's case. "Sustainability is something new to many people, including us," says Thiraphong. "We thought we had to do the right thing within our organization but Greenpeace demanded we cover the whole supply chain."

Thiraphong is clearly still upset by the negative coverage, but he is determined to get on the front foot. The 51-year-old marathon enthusiast will be running the course in London this April on behalf of the World Wildlife Fund. He is keen to dress up, and costume possibilities are being explored. Picturing the seafood-loving CEO dressed as a can of John West tuna begs the question: Has any company tried to gobble you up? "No, fortunately," he says. "You know why? This business requires a lot of hard work. It's wet and dirty, labor intensive and has very thin margins. It doesn't look sexy."

THE YOUNG PRETENDER The name still stumps a few taxi drivers but the Mahanakhon, the tallest and oddest-looking new structure on Bangkok's skyline, is hard to miss. With a 77-story facade, spiral-cut like someone went to work on it with a chisel, it's a bold statement in glass and steel.

The developer behind it, Sorapoj Techakraisri, has shot into Bangkok's acquisitive big leagues over the past couple of years. His Pace Development Corp. bought out U.S. grocer and restaurant chain Dean & DeLuca in a surprise purchase in 2015 after bringing the first outpost to Thailand despite having no previous retail experience.

Bangkok then was in the throes of floods and a coup, but still a select crowd came for good coffee, Italian seasoning salts and picnic provisions. "That was the only problem: not enough seats," says Sorapoj. The 38-year-old CEO is relaxing in the rooftop lounge of the Mahanakhon Cube, a squat sister development of bars and restaurants (including Dean & DeLuca) overlooked by the looming tower.

Sorapoj is the son of a prominent midrange property developer but describes his own niche as "superluxury," catering to a growing group of well-traveled Thais and expats buying in to Bangkok's property boom. He is convinced that demand for high-end residential buildings in Bangkok will only grow. "Foreign firms that move to this region want to set up here," he says, citing Thailand's banking and legal structures. "This country is the head office for Myanmar, Cambodia, Vietnam and Laos."

In 2009, Sorapoj was in Tokyo's Midtown commercial complex looking for inspiration for his tower and stopped off at a Dean & DeLuca restaurant. Seeing potential for a "gourmet supermarket" back home, he tried to persuade the owners to open a branch in Thailand; when they refused he took a license himself, opening in front of the then-unbuilt Mahanakhon.

Sorapoj did not see the original Dean & DeLuca -- founded in 1977 as a neighborhood grocer-deli in New York's Soho -- until he went to buy the brand outright for $140 million. The purchase by a newcomer came as a surprise, but it was strategic. "When you do a big development like this," says Sorapoj, gesturing to a glass balcony over a crevice in Mahanakhon's facade, "and you're sold out, that's it: finished. You've got to start over in a new site." Food and beverage is less volatile and more long term, he counters, "as long as you don't damage the brand."

Pace is now looking to aggressively expand the 40-year-old deli. "The brand is bigger than the business," says Sorapoj. "People say it's timeless with its blue-and-white branding and font. There are 11 stores in the U.S. but people think there are hundreds. That's an opportunity. We're ready to open another 20 stores in five major U.S. cities this year." His ambitious plan is to eventually open hundreds in the U.S. and the same number spread across the rest of the world; London will see its first outpost as early as this June. Sorapoj is also in talks to partner a with U.K. food retailer occupying a similar niche to Dean & DeLuca.

Sorapoj may sound bullish, but for all his enthusiasm he has hit some bumps. The Dean & DeLuca outlets aren't faring as well as he would like, and as the Thai economy continued to struggle at the end of 2016, two institutional investors were needed to get the Mahanakhon finished.

The completed tower is still an important statement. Pace says that 75% of the Ritz-Carlton-managed apartments are sold, and in March the first tenants will move in. After five years of development the company won't be back in the black until then. Sorapoj says Bangkok's bigger players were doubtful that an upstart company could make it happen. It's a calculated risk, but how do you calculate on the country's tallest building? "Actually, you can't," he says. "It's calculated in that it's never been done before."

This report first appeared in Monocle magazine. To find out more about the magazine and to subscribe, visit

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