Group becomes strategic investor of PetroVietnam in port project in Dong Nai province.
The Hoanh Son Group, a private company specializing in transport, construction, and infrastructure and based in north-central Ha Tinh province, has recently acquired a majority stake in the Phuoc An Port project in southern Dong Nai province.
A representative from the Hoanh Son Group confirmed with VET that the company’s holding in Phuoc An is 51.11 per cent and the acquisition was implemented via a subsidiary, the Hoanh Son Ltd Co., on July 9.
Hoanh Son Ltd Co. outlaid VND460 billion ($20.7 million) to buy 46 million shares from the State-run PetroVietnam (PVN) group, which was previously the major shareholder with a holding of 80 per cent.
Phuoc An Port is a cooperative agreement between PVN and the Dong Nai People’s Committee signed in 2007 with investment capital of $765 million. One year later the PetroVietnam Phuoc An Port Investment & Operation Joint Stock Company was established and was granted an investment license in 2009.
Project implementation has been very slow in the seven years since, however, with site clearance still being conducted. With a policy of investment socialization and a focus on its core areas, PVN decided to find a strategic partner to speed up the project and selected the Hoanh Son Group.
With a prime location, just 40 km from the center of Ho Chi Minh City and the industrial belt in Binh Duong province, Phuoc An Port is expected to become a seaport and logistics complex on 800 ha that will serve customers in the Southern Key Economic Region. It has a planned capacity of 2.5 million TEUs per year and 6.5 million tons of cargo.
The Hoanh Son Group has recently been in the news, after the Sao Vang Rubber JSC (SRC) chose it as a partner in investing in a trade center, service and office complex at 231 Nguyen Trai Street in Hanoi’s Thanh Xuan district.
Hoanh Son will spend VND435 billion ($19.5 million) on supporting SRC to move its rubber plant on the site to the Chau Son Industrial Park in northern Ha Nam province. The two parties plan to establish a joint venture, in which SRC will hold 26 per cent.
The deal sparked much controversy in the real estate sector as real estate giants such as the BRG Group and the FLC Group were hoping to partner SRC.
The reason for selecting Hoanh Son is that it has solid financial resources and has also been a partner in many projects with the State-run Vietnam National Chemical Group, SRC’s largest shareholder.
Over the last few years Vietnam has witnessed a trend in which private companies buy or acquire a majority stake in State-owned companies or their subsidiaries that also possess significant land assets.
According to the Vietnam Maritime Administration, Vietnam now has 49 seaports at three levels - I, II, and III. Total investment capital needed for the country’s seaport network to 2020 is estimated at VND100 trillion ($4.5 billion).