Photo: Duc Anh
Binh Son Refining & Petrochemical Company aiming to cut its holding to 51% as part of its own equitization.
The PetroVietnam Building and Commercial Joint Stock Company (PV Building) conducted its first IPO on July 12 at the Hanoi Stock Exchange (HSE).
The Binh Son Refining & Petrochemical Company Limited (BSR) had previously stated that it was to cut its stake in PV Building to 51 per cent from 96.53 per cent.
There were a total of 7.9 million shares publicly offered, equal to 45.53 per cent of PV Building’s charter capital, at an initial price of VND12,200 ($0.6) per share.
On July 12 a total of 19 individual investors bought 2.325 million shares at the initial price, accounting for 29 per cent of the total shares offered, according to HSE.
BSR received VND28.4 billion ($1.3 million) from the sale and now holds 67.5 per cent of PV Building.
Reducing its stake in PV Building to 51 per cent is part of BSR’s preparations for its equitization, according to CEO Tran Ngoc Nguyen. “The sale is to restructure BSR while PV Building becomes a listed company,” he was quoted as saying.
PV Building operates in three main sectors: producing and selling cement and agricultural packaging products, selling granulated prolypropylen (PP) and polyethylene (PE), and providing management services for real estate companies and restaurants.
It holds a large market share in the packaging sector and has been a strategic partner of BSR. Not only does it provide the Dung Quat Oil Refinery with 12,000 to 14,000 tons of PP annually it also provides 100 per cent of three-surface PE bags for the refinery’s packaging products.
“PV Building’s IPO will not have any negative impact on the company’s operations,” Mr. Nguyen said. “It will actually have a positive impact, especially on Dung Quat’s expansion plans in the coming years.”
According to a stock analyst at Maritime Securities Incorporation (MSI), “the PV Building divestment is expected to have a positive impact on the equitization process of BSR.” After divesting from PV Building and other companies, BSR will be able to focus on its main operations, he added.
PV Building was established in March 2009 and has three shareholders: BSR with 96.53 per cent, the Cam Thanh Guest House of the Quang Ngai Province Committee Office with 3.14 per cent, and individual shareholders with 0.33 per cent.
Its total profit is forecast to increase 30 per cent annually, with after-tax profit in 2015 at VND10.8 billion ($491,000), according to the company’s report. After acquiring the Dung Quat Packaging Company from BSR in 2014 its charter capital increased from VND55 billion ($2.5 million) to VND175 billion ($8 million).