Vietnam: Vinamilk to acquire 47% stake in GTNFoods

A woman shops for Vinamilk products. Photo from the company's website.

Vietnam’s largest dairy producer Vinamilk has offered to acquire nearly 47 per cent stake in GTNFoods JSC, which now owns 51 per cent stake of Moc Chau Milk JSC and two other state-run agricultural companies.

According to an official disclosure on Ho Chi Minh City Stock Exchange (HoSE),  Vinamilk plans to acquire 116.7 million shares, equivalent 46.68 per cent stake of GTNFoods. At a price of VND13,000 apiece,  Vinamilk is expected to buy the stake for over VND1.5 trillion ($64.8 million).

GTNFoods (formerly Dai Viet Minerals and Environment JSC) was established in 2011 with a capital of VND80 billion ($3.52 million). Within just three years, it increased its capital 8.5-fold and was listed on the stock exchange in 2014, when the company embarked on M&A activities, starting with a 10.14 per cent equity in Ladofoods.

GTNFoods completed its acquisition of the Vietnam Livestock Corporation (Vilico) and the Vietnam National Tea Corporation (Vinatea) at a cost of over VND1.8 trillion in 2016-2017, local media reported.

Currently, GTNFoods holds nearly 75 per cent of Vilico’s shares, thereby indirectly owning 51 per cent of Moc Chau Milk, which is accounting for about 10 per cent of the dairy market share.  In addition, the company owns 95 per cent of Vinatea, 35 per cent of LadoFoods (Vang Da Lat) and many other companies.

Vinamilk is the largest dairy producer in Vietnam with 55 per cent market share of liquid milk in 2018.

Last July, F&N Dairy Investments, a part of Fraser & Neave Limited, registered to purchase additional shares of Vietnam’s largest dairy producer Vinamilk to lift its ownership to 18.31 per cent.

Meanwhile, Singapore-listed automotive group Jardine Cycle & Carriage Limited (JC&C), a Jardine Matheson company, through its wholly-owned subsidiary Platinum Victory Pte Ltd, had earlier registered to acquire an additional 14.51 million shares in Vinamilk to increase its stake in the Vietnamese firm to over 11 per cent.

F&N Dairy Investments is the second largest shareholder in Vinamilk, followed by The State Capital Investment Corporation (SCIC), which holds 36.01 per cent of chartered capital.

Vinamilk recorded a total of VND52.56 trillion in net revenue in 2018, up 3 per cent year on year. However, its post-tax profit slid to VND10.2 trillion from VND10.3 trillion in 2017.

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