LOCAL investors will be offered Board of Investment (BoI) incentives on an automatic basis if they win bids to buy back assets in Thailand from troubled foreign companies affected by the US financial crisis.

According to Deputy Prime Minister Olarn Chaipravat, the government wants to support local investors seeking to acquire the properties, such as three developments owned by the bankrupt US investment bank Lehman Brothers in Samui and Phuket.

The projects, which Lehman reportedly plans to offer soon, are the Samui Hotel 2, Siri Phuket, and Laem Ka Property.

When Lehman Brothers won BoI privileges three years ago the three projects were listed as having an investment cost of Bt12.6 billion to build resorts and hotels in Phuket and Samui.

Samui Hotel 2 was awarded BoI privileges in late 2006 with a total investment of Bt2.775 billion to build a 135-room hotel on Samui, while Siri Phuket Co won BoI privileges in March of this year to build a 107-room hotel on Phuket with a total investment of Bt2.584 billion. Laem Ka Properties won BoI privileges last year to build a 206-room hotel on Phuket with an investment of Bt7.2 billion.

Dr Olarn said this would be a good opportunity for local investors to expand their holdings, as during the crisis the assets will generally be cheaper.

According to Dr Olarn, the government is also preparing to set aside up to Bt60 billion for preferential loans through state banks for Thai entrepreneurs seeking to make such acquisitions.

Currently, hotel construction in Phuket and Samui is not entitled to an exemption from corporate tax for eight years like projects in Zone 3, which groups the country's 60-plus less-developed provinces, as the islands are prime locations.

However, investors developing projects can enjoy the exemption from machinery import duty and facilitation for hiring foreign employees.