Vietnamese food major Kido Group is looking at listing its subsidiary arm – Kido Frozen Foods (KDF) – in the second quarter of 2017 after the completion of its initial public offering of 20 per cent stake this month, the company announced over the weekend.
Kido Group currently holds 99.8 per cent of KDF. The sale of its 20 per cent ownership in the frozen food subsidiary, slated for completion by April 19, will be followed by a 15 per cent divestment to business partners and company’s employees, an executive with the firm told DEALSTREETASIA in an email interaction.
KDF will not select strategic investors, this executive added. The target of the IPO is to attract external funding to KDF, the announcement said.
The shares in the IPO are priced at VND52,000 apiece, based on “the adequate transaction value and the evaluation by financial agencies”. This range values KDF at around VND3 trillion ($132 million).
Viet Dragon Securities is advising the group on the IPO and listing.
The brokerage house, in which Kido Group acquired part of stake in 2015, values KDF shares higher at VND64,700 each, projecting the company’s revenue to expand 27 per cent to reach nearly VND1.8 trillion in 2017, which will potentially lead to a net profit of VND202 billion.
KDF will be traded on UPCoM (unlisted public company market), a sub-exchange on the Hanoi listing bourse.
The listing will take place in the second quarter (IPO and listing are different processes in Vietnam).
Kido Group acquired the Wall’s ice cream brand from Unilever in 2003 to establish KDF. The ice cream business has been contributing to a higher proportion of the firm’s revenue.
While Kido declined to name the investors who have submitted bids to buy KDF shares, which were reportedly oversubscribed by 3.6 times, the group’s deputy chairman-cum-CEO had earlier announced in a KDF roadshow late March that Unilever had expressed an interest in the IPO.
Kido Group, which sold out its snack business to Oreo maker Mondelez for $460 million, has been focussing on the production of three main consumer products: frozen food – primarily ice cream, instant noodle, and vegetable oil – the line that saw the group acquire a majority stake at formerly state-owned Vocarimex.