Vietnam’s Thong Nhat Production and Investment JSC has announced it is planning to issue 75.2 million shares to fund the aggressive acquisition of four state-owned agricultural companies.

 

Thong Nhat’s current value of registered capital is US$30.36 million, but this is expected to more than double by the second quarter of 2016. During its shareholder meeting in May, the company announced that US$15.6 million of the funds raised through the share issuance will be allocated to acquiring four agriculture companies in the public sector.

 

The identity of two of the four companies has been released – The Vietnam National Tea Corporation (Vinatea) and the Vietnam Livestock Corporation (Vilico). Thong Nhat will be buying a total of 27.75 million shares, or a 75% stake in Vinatea, purchasing 23.56 million shares outright, and purchasing the remaining 4.19 million shares during Vinatea’s initial public offering (IPO) on September 16. Upon completion of the IPO, the state will not be holding any equity in the company.

 

Thong Nhat announced it will also be acquiring a 12.12% stake in Vilico, which was privatized in 2013, with an increase stake purchase planned in the future. Currently, 78% of Vilico is owned by the state.

 

In March 2015, Thong Nhat also increased its stake in Lam Dong Foodstuffs JSC to 35%, and plans to be involved in the restructuring and management of the company.

 

In 2014, Thong Nhat reported revenues of US$28.2 million and profits of US$4 million – a four-fold increase over the previous year. This year, the company expects to post revenues of US$66.7 million and profits of US$6.2 million.