Bien Hoa Sugar Joint Stock Company and Tay Ninh Sugar Joint Stock Company, two subsidiaries of TTC Group, will take over the sugar operation of Hoang Anh Gia Lai in a bid to make TTC Group the biggest sugar producer in Vietnam in terms of output.
The boards of directors of Bien Hoa Sugar (HoSE: BHS) and Tay Ninh Sugar (HoSE: SBT), the two biggest sugar producers under TTC Group, have just approved the strategic investment in Hoang Anh Gia Lai Cane Sugar Limited Company. The two companies are going to hold extraordinary shareholders’ meetings at the end of May in order to ratify the merger.
Specifically, BHS is going to buy 60 per cent of HAGL Sugar from Hoang Anh Gia Lai Agricultural Joint Stock Company (HoSE: HNG). The long-term financial investment contract has a value of VND798 billion ($35.1 million) and will be carried out by the end of 2017.
TTC Tay Ninh Sugar will buy 40 per cent of HAGL Sugar from HNG and an individual shareholder. Though the investment has only been announced just now, HNG already assigned management positions and the right to operate the sugar factory, the sugar cane farm, and related assets to SBT.
Nguyen Quoc Viet, key personnel at TTC Group, has been assigned as the general director of HNG. He is currently also the deputy general director of BHS.
HAGL Sugar was established in Vietnam. It owns 100 per cent of Hoang Anh Attapeu Cane Sugar Limited Company, which owns a factory and a farm in Laos. The parent company HNG reported a net profit of VND7.16 billion ($315,500) in the first quarter of 2017, down 92 per cent on-year. The profit broke a three-quarter loss streak for the company.