In January 2006, a consortium led by Temasek bought a controlling stake in Shin Corp. for US$1.9 billion from the family of former Prime Minister Thaksin Shinawatra, a move that helped precipitate a coup and his ouster last September.

Thaksin's critics claimed the sale endangered national security because it placed strategic assets, including Thailand's only communications satellites, in the hands of foreigners.

There were also suggestions the sale was structured in a way that breached financial laws on foreign ownership of Thai companies.

"The legal investigation aside, we should not take Shin back or seize its assets. It will send a wrong message to foreign investors," Chalongphob told Dow Jones Newswires in an interview.

National sentiment against Shin's sales to Temasek was fanned by the military after it staged the coup, with generals suggesting the company's ownership of the satellites - as well as a mobile phone service provider, AIS, owned by Shin - allowed Singapore to spy on Thailand.

"The two sides must find a middle ground," Chalongphob said Friday. "Temasek understanding the feelings of the Thai people, and we not pushing the case to extremes."

The allegation that financial laws may have been broken gave rise to suggestions that Shin's assets simply be seized by Thailand. Others suggested buying the company back.

Thai Information and Communications Technology Minister Sittichai Pokaiudom, who is overseeing the case, told Dow Jones Newswires in February that he was convinced Temasek broke Thailand's foreign ownership laws and that Shin may soon return to Thai control.

But Chalongphob struck a more conciliatory tone than Sittichai, indicating a desire at the most senior levels of the Thai government to ease tensions between the kingdom and the city-state and to resolve the Shin row without further damaging Thailand's post-coup reputation with foreign investors.

He said strong anti-Singapore comments by various government officials were made in the "heat of the moment" and as the government was considering its policy on the Shin Corp. issue.

He also said that the country's new foreign business act, which deals with issues like foreign ownership limits and shareholder voting rights, should be more investor friendly than a version that has already been approved by the Cabinet, but is still under consideration for possible changes.

"Companies should be given more time to adjust when we introduce changes," he said.

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