HD Saison may be setting up for IPO

June 26, 2020 | 22:31

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At the recent annual shareholder meeting, HD Bank revealed its ambition to convert HD Saison into a joint-stock company. This is generally seen as move laying down the groundworks for an initial public offering (IPO).

The decision comes right after FE Credit – one of the competitors of HD Saison – was approved to switch from the limited liability to a joint-stock company format. FE Credit also got the green light from local authorities to raise its charter capital. Moreover, the shift into the new model would pave the way for FE Credit to go public.

HD Saison has raised charter capital and is maybe now planning an IPO

Ealier this year, the State Bank of Vietnam (SBV) approved increasing the charter capital of HD Saison. After the capital hike, HD Bank holds 50 per cent of the stakes in the consumer finance firm while Japanese investor Credit Saison and Ho Chi Minh City Securities Company own 49 and 1 per cent, respectively.

HD Saison is the consumer finance arm of HD Bank and Japanese Credit Saison. It also sells Vietjet airline tickets on an instalment basis via its website and mobile banking. HD Bank now manages over 80 per cent of Vietjet’s cash flow. This is one of the strategic initiatives to continue the “ecosystem” strategy.

Besides, HD Bank’s Board of Management plans to take advantage of the near-zero per cent interest rates to secure mid- to longer-term funding from international markets via a convertible bond and overseas bonds.

Shareholders approved issuing up to $500 million in convertible bonds between 2020 and 2021 and up to $1 billion in Euro Medium Term Notes (EMTNs) between 2020 and 2024, with maturities of three to 10 years.

Shareholders also approved the plan to declare a 2-for-1 stock dividend for 2019 performance as well as issuing 15 per cent bonus shares from capital surplus, according to KB Securities.

On the other hand, the bank noted that it would complete the final application process with the State Bank of Vietnam to finish the M&A deal with local lender PGBank.

By Minh Luu

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