Yarnapund Plc (YNP) is seeking growth through a merger strategy after the company turned down a deal to sell its new issued shares to a prospective foreign alliance, according to Chairman Vichai Thongtaeng.

Yarnapund’s share prices had been peaked at 8 baht a share in May over a rumor that the company reached a deal with one of its speculative foreign alliance, but the new issued shares at par value of 5 baht rapidly tumbled down to bellow 1 baht a share after failure in talks.

Yarnapund, one of Thailand’s oldest makers of auto parts, said it is now seeking a consolidation with partner in the auto industry in an attempt to eliminate its financial weak, consisting of huge total debt of 10.53 billion baht comparing to its total assets of 13.99 billion baht.

The company admitted it is unlikely to achieve an annual sales target of 10 billion baht by 2009 as projected.

“We will stay at an annual sale growth target of 10 per cent as previously predicted. This will keep us staying on course, but I am too eager to see leap in an annual sales figure,” Mr. Vichai said.

“After failure in strategic partner talks, we will be seeking for a merger partner. I’ll be approaching a prospective alliance myself,” he added.

Yarnapund hopes to swing to profit from a previous year lost of 240 million with forecasted turnover between 7.2-7.5 billion baht in 2008 expected to generate from fresh orders by automakers in the U.S. and Europe.

The company recently kicked off new auto parts production lines at its second-phase plant worth 2.5 billion baht in Rayong.