Confectionery company Vinabico-Kotobuki is set to auction more than 29,000 shares in a move that will complete its equitisation process, director Duong Hong Lam said last week.
“The Ho Chi Minh City government and its parent company Strata have allowed Vinabico-Kotobuki to carry out the initial public offering through an auction,” Lam said.
“We have set up a share auction council. If things go okay, the auction will begin on October 9,” she said, adding that the Ho Chi Minh City Securities Company (HSC) would help conduct the auction.
The company has fixed the share price at VND105,000 against a face value of VND10,000. An individual investor can buy between 300 and 3,000 shares.
Decree 64/2002/ND-CP, dated June 19, 2002, on equitising state-owned enterprises (SOEs), states that at least 30 per cent of SOE shares offered to outside investors must be auctioned.
“This method will help the company float its assets on the stock market in future,” Lam said.
Under the approved equitisation plan, the former joint venture will have a chartered capital of VND14 billion ($900,000) of which the State will retain 20 per cent, 59 per cent will be offered to staff, and 21 per cent auctioned to outside investors.
Vinabico-Kotobuki was established 10 years ago as a joint venture, but became wholly locally-owned last November when Vinabico purchased a 60 per cent stake for $2.24 million from Japan’s Kotobuki. It is now affiliated with Saigon Trade Corporation or Strata.
Lam said Vinabico bought out Kotobuki and renounced state ownership because operating on a joint-stock basis would give the company more leeway to raise funds.
The new shareholding company will be exempt from corporate income tax for the first two years after equitisation and get a 50 per cent exemption for the next two years.
The stake transfer agreement allowed Vinabico to keep the trademark Vinabico- Kotobuki.
“The Japanese company will give us a year’s notice if it wants us to stop using the trademark,” Lam said.
Vinabico-Kotobuki produces a variety of cakes and sweets, exporting 20 per cent of its production to Japan, Korea, Taiwan and other regional markets.
The company has just imported an automatic wafer production line from Austria to replace its ageing line. The new equipment, costing E250,000, will help the company raise its production by 17 per cent.
This year, Vinabico expects to top turnover of $9.7 million, including $1.5 million from exports.
By Nguyen Hong
vir.com.vn