Truong Hai Auto Corporation (THACO) - one of the leading car manufacturers in Vietnam is expected to invest nearly US$1 billion in conglomerate Hoang Anh Gia Lai Group (HAGL), announced the latter on its website."The partnership between HAGL and THACO will create a new ecosystem for Vietnamese enterprises under the platform of applying technologies into corporate governance and production," said Tran Ba Duong, chairman of THACO at the announcement on August 8.
Overview of the announcement. Source: VGP.
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For HAGL Agrico, THACO is expected to spend VND3.8 trillion (US$163.5 million) buying convertible bonds in return for a 35% stake in the company.
Dai Quang Minh Real Estate Investment, a unit of THACO, will acquire a 51% stake in HAGL Myanmar Center, with a view of increasing the holding to 65% for a total investment capital of VND4 trillion (US$172.1 million).
Additionally, THACO will be responsible for restructuring HAGL Agrico with an additional investment capital of VND12 trillion (US$516.3 million).
THACO, through Dai Quang Minh, is expected to take over the second phase of the investment project HAGL Mynamar with investment capital of US$320 million and complete the project by 2020.
At the event, Prime Minister Nguyen Xuan Phuc considered the partnership between THACO and HAGL as "a match made in heaven", as both are Vietnam's leading companies in industrial and agricultural sectors, repsectively.
The move is significant, especially when Vietnam is stepping up efforts to industrialize and modernize the agricultural sector, Phuc added.
THACO with its financial capabilities, expertise and technology will be vital for HAGL facilitating its agricultural projects in Vietnam, Laos and Cambodia, the prime minister said.
Shares of HAGL (coded HAG) jumped to the upper limit at 7,430 dong (US$0.31) each right after the open on August 9, with investors queuing to buy 10 million shares at the break time.
