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|An Phat will try to revive the Viet Hoa-Kenmark IZ to further its ambitions|
After winning at the auction organised by Bank for Investment and Development of Vietnam (BIDV) in March, An Phat became the new owner of Viet Hoa-Kenmark IZ and renamed the IZ to An Phat Complex Hi-Tech IZ.
Previously, in March 2018, BIDV, the largest creditor of Viet Hoa-Kenmark IZ, organised an auction to put the notorious IZ on sale. An Phat won the bidding after paying VND756.45 billion ($33.47 million), equalling the starting price of the auction. However, the selling price is still lower than the VND800 billion ($35.39 million) that BIDV expected to acquire from the deal.
While BIDV is happy to have gotten rid of the liability, An Phat expects that revive the IZ and make it its new base, serving its target to establish itself in the local plastics industry.
According to the development plan submitted to the Hai Duong People’s Committee, An Phat will focus on manufacturing hi-tech and environment-friendly plastic products to serve the automobile, mobile phone, self-degradable plastic, construction materials manufacturing sectors, among others. Besides, An Phat will conduct R&D activities and other activities related to the plastics industry in the IZ.
At first, An Phat will accelerate the renovation of the existing workshops in order to take them into operation and then will continue renovating the remaining infrastructure.
Despite An Phat being a newly-established firm (it was established in October 2017), with its financial potential thanks to the backing of An Phat Plastic and Green Environment Joint Stock Company, it is well within An Phat’s reach to implement its plans.
This year, An Phat’s parent company set the target to acquire VND6.36 trillion ($281.4 million) in revenue and VND332 billion ($14.69 million) in net-profit, signifying increases of 56 and 25 per cent.
Regarding its long-term development plan with a vision to 2025, An Phat Plastic will join deeper into the value chain of the plastics industry, expand its business sectors, and reach approximately $1 billion in revenue, up 3.8 per cent compared to the figure of 2018.
According to the information published on An Phat Plastic’s website, in the second quarter of this year, An Phat Plastic poured an additional VND659 billion ($29.1 million) into An Phat to increase the An Phat Plastic’s total capital in the firm to VND876 billion ($38.76 million), equalling 96.15 per cent of its charter capital.
Viet Hoa-Kenmark IZ was licensed in 2005. At the time, the developer Kenmark Group from Taiwan promised to inject $500 million to turn the empty land into a mammoth IZ and an urban township.
During the first phase, Kenmark was set to disburse about $98 million and, in fact, spent $44 million to build internal roads, workshops, as well as a wastewater treatment facility and an electricity generation system.
However, in 2010, the developer abruptly returned home, suspending the project without further notice.
The problem is that previously Kenmark borrowed $67.6 million from three banks ($39.1 million from BIDV, $18.5 million from SHB, and $10 million from Habubank). Subsequently, Habubank was merged with SHB, who inherited Habubank’s loans.
When Kenmark left, it suspended payments on its $67.6 million debt to the Vietnamese banks, causing a major headache.
BIDV also put the IZ on sale numerous times to recover the loans but failed.