Vietnamese shrimp processor Quoc Viet Seafood has mandated Ernst & Young to start a sale process for its majority stake offering by the end of this month, according to a report on undercurrentnews.com.
By giving up a majority interest, Quoc Viet reportedly said it is looking to raise funds to meet working capital needs of its farm integration plan.
An email request sent to Ngo Quoc Tuan, vice president of the company, has not elicited a response at the time of publishing this article.
Quoc Viet was founded and is being operated by Tuan’s family. It is understood that the company does not have an institutional investor.
Tuan reportedly said, the business seeks to self-provide raw material from its own farms, which require a large capital injection.
“This will be more efficient and we will have control over diseases. But this is capital intensive,” undercurrentnews.com quoted Tuan as saying.
He said, the company was open to both strategic and financial investors, but the latter would be more likely in the short term. “We see this happening in two phases, as strategic investors take time. So, the first phase might be a private equity deal and then we would look for a strategic partner in the future.”
Quoc Viet’s revenue declined from $180 million in 2017 to $130 million in 2018, but the company remained profitable.
Last month, DEALSTREETASIA reported that Minh Phu, Vietnam’s largest shrimp exporter, proposed to offer a private placement of 35 per cent equity, valued at $153 million. Japan’s Mitsui has committed $100 million to the deal, while Minh Phu said it has attracted four other investors from the US, Japan and South Korea.