Miss Universe ambition of Thai 'boss'

Jakkaphong “Anne” Jakrajutatip bought the Miss Universe Organization to revive the company but filed for bankruptcy protection a year later.

On November 8, JKN Global Group - the Thai media company that owns the Miss Universe brand - filed for bankruptcy protection at the Thai Bankruptcy Court. In a notice to the Thai Securities and Exchange Commission, JKN Global Group founder and CEO Jakkaphong "Anne" Jakrajutatip said they want to restructure debt and improve liquidity.

JKN has recently delayed payments on several bonds, citing economic challenges at home and abroad. The company has even been studying bankruptcy options since September, despite investors agreeing to extend some debt payments.

JKN made headlines last year when it bought the Miss Universe Organization (MUO), the organizer of the Miss Universe pageant, for $20 million. A Nikkei Asian Review source said the pageant could be discontinued or transferred to another company as JKN restructures.

Jakkaphong "Anne" Jakrajutatip bought MUO with great ambition. In a meeting with business leaders in the retail, tourism , hotel and restaurant industries to discuss cooperation last November, she expected the beauty pageant brand to grow at least 40% and become the driving force to help JKN become a major player in the global content business.

Ms. Jakkaphong "Anne" Jakrajutatip - Founder and CEO of JKN. Photo: JKN

MUO was owned by former US President Donald Trump from 1996 to 2015. The competition was later sold to sports and entertainment company Endeavor Group Holdings.

The sale price was not disclosed at the time. However, financial reports related to the Trump campaign at the time said MUO was valued at between $5 million and $25 million and had revenue of $3.4 million.

A New York Post source said MUO lost $2 million and recorded annual revenue of $7-9 million. Miss Universe's traditional sources of revenue are licensing to participating countries, hosting the pageant, organizing annual events and broadcasting rights.

When JKN acquired Miss Universe, it had been on a five-year streak of declining ratings, with recent scandals taking a toll on its reputation. The 2022 pageant even had a record low viewership when it aired, with just 2.7 million viewers on Fox.

After taking over, Jakkaphong said she plans to list MUO on the New York Stock Exchange (NYSE). They will also create new revenue streams for the brand.

Accordingly, MUO can collect franchise fees, organization fees, production fees, money from products and services using the Miss Universe brand, sponsorship money, broadcasting royalties, money from shows and programs related to Miss Universe, money from event ticket sales and money for managing the beauty queen's activities.

MUO’s large presence is also expected to help JKN recover after nearly two years of declining profits. In 2021, the company recorded a 44.4% drop in profits, despite a slight increase in revenue to 1.8 billion baht. In the first nine months of 2022, debt and advertising costs continued to drag down business results. Profits fell 21% compared to the same period last year.

US representative R'Bonney Gabriel crowned Miss Universe 2022. Photo: Reuters

In an interview in February, Jakkaphong revealed that JKN had secured an additional 800 million baht from MUO and expected the figure to rise to 1.2 billion baht this year. The Nation quoted Jakkaphong as saying that El Salvador paid 400 million baht to host the contest this year. JKN is also preparing to sign contracts related to the organization of the event for the next two years.

The MUO brand can also help JKN promote its other products. JKN owns several TV channels in Thailand and sells consumer goods such as toothpaste, herbal drinks, etc. They plan to expand into the beverage, health care products, and cosmetics sectors. The company's revenue is forecast to reach 4 billion baht this year.

"We are selling broadcasting rights, franchises, production fees, everything related to Miss Universe. Later, we can sell consumer goods under the Miss Universe brand: skin care products, Miss Universe cosmetics, beverages... All within one ecosystem, with the Miss Universe logo or brand," she said.

Jakrajutatip is also a celebrity in this country. She is transgender, has assets of 210 million USD in 2020 (according to Forbes ) and has appeared on the Thai version of the TV shows "Project Runway" and "Shark Tank".

However, JKN’s business has not improved significantly so far. JKN shares fell 25% on the day it announced the acquisition of MUO, despite Anne saying that Miss Universe would bring in nine new revenue streams for JKN. The rule changes also caused MOU to lose many contestants, which meant a drop in revenue.

As of the end of June, JKN had a total of 7.4 billion baht in debt, nearly half of which was in bonds. On September 1, JKN also missed a payment of 443 million baht ($12.4 million).

JKN shares plunged 30% on the Bangkok Stock Exchange on November 9, hitting a record low of 0.76 baht, bringing the year-to-date decline to 81%.

"At the time of buying MUO, JKN's cash flow was not good. MUO was also in the red. Since then, we have not seen any positive impact from this investment," Kitpon Praipaisarnkit, deputy director of UOB Kay Hian Securities, told the Bangkok Post.

According to the plan filed with the court, JKN wants to extend the repayment of the debt and forgive some of the interest so that it has profits to pay all creditors. They also want to receive financial support from new investors, or from a financial institution.

Jakkaphong said the company is trying to negotiate with creditors and has no intention of avoiding payment. "The company is lacking liquidity and it could cause a domino effect with related parties," she said.

JKN could also sell some of its non-performing assets to pay down debt, while continuing to operate. “This would be a suitable solution given the current liquidity situation,” Jakkaphong concluded.

Ha Thu

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