Hoa Binh Construction divests Matec stake to boost capital

June 21, 2023 | 14:54

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Hoa Binh Construction Corporation has recently passed a resolution to sell its entire stake in construction machinery firm Matec to supplement its business activities with additional capital.

Hoa Binh Construction divests Matec stake to boost capital

Matec, a subsidiary responsible for managing the entirety of Hoa Binh’s machinery and equipment, will be divested to Ashita Company, an investor specialising in machinery trading, which will acquire the shares for VND1.1 trillion ($46.7 million).

Le Van Nam, CEO of Hoa Binh Construction, stated that the divestment of the subsidiary aligns with the company's restructuring plan.

Once the necessary procedures are completed, the funding will be disbursed to Hoa Binh's various business operations. The move follows a previous resolution by Hoa Binh’s Board of Directors on May 20, which involved the transfer of the entire capital contribution of Hoa Binh Innovation Centre Limited Liability Company to Nuance Limited Liability Company for VND167 billion ($7.1 million).

"The comprehensive restructuring of Hoa Binh is an urgent and necessary plan for this year. We will retain only those companies with efficient business activities while continuing to invest towards our goal of an initial public offering in the near future," said Nam.

Furthermore, Nam indicated that the financial departments of all subsidiaries and affiliates will be consolidated under the Financial Committee of the conglomerate to achieve centralised financial management and risk control.

On February 13, after internal turbulence at the top level, the company’s Board of Directors approved the resignation of Nguyen Cong Phu, an independent member of the board. The company has also received a resignation letter from Le Quoc Duy, another board member, which will be considered at this year's shareholders' meeting.

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Japan’s Meiko Corporation has recently partnered with the leadership of Hoa Binh province to propose an investment plan for constructing an electronic circuit manufacturing facility at the Da River Left Bank Industrial Park in Hoa Binh city.

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By Lam Tien

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