Japan-based Eneos plans to acquire US$28-million stake of Vietnam Petrolimex

Japan-based Eneos Corporation, a subsidiary of Nippon Oil & Energy Vietnam, is planning to purchase 13 million shares, or a 1% stake of Vietnam’s largest petroleum distributor Petrolimex, according to a filing to Ho Chi Minh Stock Exchange (HoSE).

Japanese shareholders are looking to increase their stake at Vietnam's largest petroleum distributor.

The transaction period is set to take place from August 27 – September 25 through order matching.

Eneos has yet to own Petrolimex shares. However, the firm is a subsidiary of Nippon Oil & Energy Vietnam, Petrolimex’s second largest shareholder with 103.5 million shares, or 8.73% stake, only behind Vietnam’s Committee for State Capital Management (CSCM) with 981.68 million shares, or an 82.79% stake.

Once completed, shareholders related to Nippon Oil & Energy Vietnam would increase its stake holding at Petrolimex to 9%.

With Petrolimex share price of VND50,400 (US$2,17) apiece at the close on August 25, Eneos is set to fork out at least VND650 billion (US$28 million) to complete the deal.

Petrolimex currently holds a 50% market share in Vietnam’s petroleum distribution sector with a retail network of more than 2,400 petrol stations and nearly 3,000 retail outlets across the country.

Due to severe impacts from the Covid-19 pandemic, Petrolimex posted revenue of VND65.2 trillion (US$2.81 billion) in the first six months of 2020, down 29% year-on-year, resulting in a net loss of VND1.08 trillion (US$46.6 million). The figure remained in stark contrast with a net profit of VND2.6 trillion (US$112.14 million) recorded in the same period last year.

For this year, Petrolimex plans a sharp decline in revenue of 36% year-on-year to a 10-year low of VND122 trillion (US$5.26 billion), and a 72% plunge in profit to VND1.57 trillion (US$67.74 million).

Vietnam’s Ministry of Industry and Trade (MoIT) previously proposed the government allow foreign investors to join the local petroleum retail market. Under the proposal, local oil and petrol traders could be allowed to transfer their stakes to foreign investors but foreign ownership should not exceed 35%.