Minh Phú Seafood to remove non-core
businesses to ease foreign ownership
|Due to the overloaded cold warehouse situation in the US, the Minh Phú Seafood Corporation is planning to build a 10,000 pallet cold storage facility in Los Angeles and another 10,000 pallet facility in New York to reduce costs. — Photo cafef.vn|
HÀ NỘI — Việt Nam’s leading shrimp exporter Minh Phú Seafood Corporation has approved a plan to remove some of its non-core businesses to pave the way for foreign investors to buy more shares in the company.
During a shareholders’ meeting on Saturday, the company’s management board agreed to abolish its real estate, civil works, road freight and motor vehicle rental operations.
The move aims to allow foreign investors to own more than 51 per cent of its capital.
Minh Phú plans to issue nearly 76 million shares to investors through a private placement to raise its charter capital to VNĐ2.16 trillion (US$92.3 million) from VNĐ1.4 trillion.
The offering price will be no lower than the book value of the company in its latest financial statement and no less than the average closing price for 10 consecutive days prior to its filing to the State Securities Commission.
The share issue is expected in 2018-19. The proceeds will be used to strengthen the company’s financial position as well as add more capital for production and business activities.
According to Lê Văn Quang, Minh Phú Seafood Corp’s chairman cum CEO, many investors had expressed an interest in the company’s shares with ratios of 35 per cent, 30 per cent and 15 per cent.
One investor even wanted to buy 35.1 per cent of the company’s capital and 15 per cent of his family’s ownership to hold a 51 per cent stake.
However, according to Quang, the investor was not satisfied with the share price, which he hoped to be at least 20-30 per cent higher than the market value.
Minh Phú’s shares are being traded at around VNĐ47,000 ($2) on the Unlisted Public Company Market (UPCoM).
The company had established a goods production and processing process but was rather weak in B2C (business to consumer) activities, Quang said, adding that the company was seeking strategic investors with strong financial capacity to help expand its markets.
He disclosed two investors from the United States and Japan who wanted to invest in the company.
According to the company, China-US trade tensions were pushing breaded shrimp imports from China to the US from a zero tariff to a 10 per cent fee that will rise to 25 per cent by the year-end.
Many US customers have asked Minh Phú to increase its sales to the US to offset falling imports from China.
The company has decided to build a $250-300 million breaded shrimp processing factory with annual capacity of 40,000 tonnes in Hậu Giang Province.
This factory, expected to be operational by 2020, will contribute more than 20 per cent to the company’s total profits.
In addition, due to the overloaded cold warehouse situation in the US, the company is planning to build a 10,000 pallet cold storage facility in Los Angeles and another 10,000 pallet facility in New York to reduce costs.
The company posted a nine-month revenue of VNĐ12.6 trillion and net profit of VNĐ681 billion, up 15 per cent in revenue and 58 per cent in profit compared to the same period last year.
It is planning to shift its listing to the Hồ Chí Minh Stock Exchange early next year. — VNS
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