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Apr 18, 2018 / 20:54

Vinafood 2 to be listed on UPCoM in April 23

Ngoc Thuy

Vietnam Southern Food Corporation (Vinafood 2) will trade on UPCoM under code VSF with a total of 114.8 million shares priced at VND10,100 (US$0.4) apiece on April 23, according to an announcement from Hanoi Stock Exchange.

Under the equitization plan, Vinafood 2 would sell a portion of its capital to reduce the state ownership to 51%. The company conducted a sale of 23% stake, which brought VND1.16 trillion (US$51 million) to the government in its initial public offering (IPO) in Ho Chi Minh City Stock Exchange on March 14. 
 
Illustration photo.
Illustration photo.
The auction attracted 41 investors, including 40 individual investors and one organization, for the 114.83 million shares on offer. The highest bid value reached VND12,000 (US$0.53) per share. The proceeds were in line with the government's expectation. 
After IPO, it will sell another 25% to strategic investors. 
Vietnam-based multi-sector firm T&T Group was earlier reported to have acquired a 25%  strategic stake in IPO-bound Vinafood 2. With the price for the strategic stake sale expected to at least match the IPO starting price of VND10,100 (US$0.45) per share, T&T Group may have had to pay at least VND1.26 trillion (US$56 million) to purchase the 25% stake.
Based on a report released by Vinafood II, the company has been facing difficulties in business activities of late. Specifically, revenue in 2015 was recorded at VND22.7 trillion (US$1 billion), which is lower than the 2016 revenue of VND26.3 trillion (US$1.1 billion). 
Also in 2015, Vinafood II reported a loss of VND9 billion (US$396.000), taking the accumulated losses to VND1.06 trillion (US$46 million), while in 2013 and 2014 the company suffered losses of VND268 billion (US$11.8 million) and VND907 billion (US$39 million), respectively. 
Vinafood II set the objective of reaching VND11.9 trillion (US$524.8 million) in revenue and VND118 billion (US$5.2) in after-tax profit, respectively, after the equitization. 
Vinafood II  specializes in trade, food import and export, processed food, agricultural products, and storage. The company currently owns a distribution system connecting the southern provinces of Vietnam. 
Vietnam is the world's third-largest rice exporter. The country is projected to export 6.5 million tonnes of rice this year, up 12% from last year.
In period 2018 - 2020, Vinafood 2 set revenue target at VND11.8 trillion (US$518.6 million), VND13 trillion (US$571.3 million), and VND14.3 trillion (US$628.4 million), respectively, for which the company's after-tax profit will be VND118 billion (US$5.2 million), VND134.4 billion (US$5.9 million) and VND176 billion (US$7.7 million), respectively.

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