In new scheme, Song Da Corp IPO to offer 220m shares

The My Dinh Urban Area in Me Tri Commune, Nam Tu Liem District, Ha Noi - a real estate project developed by the Song Da Corporation. - VNS Photo Doan Tung

The IPO will be held on December 25 at the Ha Noi Stock Exchange. The shares will be sold at the starting price of VND11,000 (49 US cents) per share.

The shares offered at the IPO equal 49 per cent of its charter capital, which is VND4.5 trillion ($200 million), or 450 million shares, the company said.

The company expects to raise more than VND2.4 trillion from the IPO. It also plans to sell 822,000 shares to its employees at preferential prices.

After the IPO, the Government will hold 51 per cent of the company’s capital, but reduce it to below 50 per cent by the end of 2019.

Song Da secured the Prime Minister approval in June to sell 135 million shares (30 per cent of the charter capital) to its strategic investor and offer 84.77 million shares (18.82 per cent of capital) at its IPO.

The total amount of shares sold to the strategic investor and at the IPO in the previous plan would be equal to the amount of shares that Song Da plans to sell at its coming IPO.

Therefore, under the latest arrangement, the company would have no strategic investor.

According to the company’s audited 2016 financial report, it had total assets of VND31.9 trillion by the end of last year. Its owner equity was VND7.83 trillion and total debts amounted to nearly VND24.1 trillion, with short and long term loans amounting to VND17.7 trillion.

The infrastructure company posted consolidated revenues of VND9.97 trillion in 2016 and net profit of the parent company was VND359 billion in 2016, down 37 per cent from the previous year.

In the first half of 2017, Song Da Corp recorded VND9.9 trillion in combined revenue, a decline of 42 per cent year on year. However, its six-month post-tax profits rose 30 per cent year on year to VND586 billion.

Song Da Corporation is the main contractor for most hydropower projects in Viet Nam. It is also involved in some major infrastructure projects including tunnels, highways and factories.

The company also plans to divest from several hydroelectricity companies this year, including the Ho Bon Hydropower Joint Stock Company, Nam Muc Hydropower JSC and Southern Power Investment & Development JSC.