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Tuong An Vegetable Oil issues shares

Released at: 18:32, 11/02/2017

Tuong An Vegetable Oil issues shares

Photo: KIDO

Company to increase charter capital for first time since being listed in 2006.

by Quynh Nguyen

The Tuong An Vegetable Oil Company (TAC), the largest subsidiary of the Vietnam Vegetable Oils Industry Corporation (Vocarimex), has approved a plan to issue shares in order to increase its charter capital.

The company held an extra-ordinary shareholders’ meeting on February 10 to announce the plan, under which it is expected to issue shares at a ratio of 10:7.

The number of TAC shares will increase to 32,226 million and its charter capital from VND190 billion ($8.36 million) to VND322.7 billion ($14.2 million).

This is the first time TAC has increased its charter capital since being listed in 2006 and after the Kido Group Corporation (KIDO) purchased a 65 per cent stake.

TAC is the second-largest cooking oil company in the country, with a 22 per cent market share. In 2016 its net revenue reached nearly VND4 trillion ($176 million), up 10.7 per cent against 2015. After-tax profit stood at VND67 billion ($2.9 million), down 4 per cent year-on-year and 3 per cent less than the target set for the year.

KIDO was granted a license last October by State Audit of Vietnam (SAV) to bid to purchase a 65 per cent stake in TAC, representing 12,337,130 shares.

The move “is considered a long-term commitment by KIDO with TAC to strengthen the development of TAC’s core businesses activities,” according to a TAC statement.

TAC’s shareholding structure changed significantly in July, with nearly 65 per cent changing hands. The Viet Long Securities Investment Fund Management Corporation (VLFM) purchased 4.55 million shares, or 24 per cent, from Vocarimex.

In January, KIDO was given permission to hold more than 51 per cent in Vocarimex without needing to conduct a takeover bid.

The green light was necessary for KIDO to acquire a controlling stake and become Vocarimex’s parent company. KIDO currently holds 24 per cent and is expected to increase its ownership to 51 per cent during the first quarter of this year.

KIDO’s net revenue reached over VND2.2 trillion ($96.8 million) last year, down 28.7 per cent against 2015. Gross profit was VND880 billion ($38.72 million), thanks to consolidating TAC’s profit.

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