Tundra Fonder becomes major shareholder of HSG as others withdraw

HSG stock has dropped to a three-year low

Tam Thien Tam Co., Ltd., a big shareholder of Hoa Sen Group, has just announced sell its entire holding of 19.21 million HSG stocks, roughly 5.49 per cent of HSG’s charter capital. The transaction is expected to take place between May 23 and June 21.

One month ago, Tam Thien Tam Co., Ltd., where Hoang Thi Huong Xuan (HSG chairman Le Phuoc Vu’s wife) is chairwoman, also sold five million HSG stocks to reduce its ownership to 5.49 from 6.92 per cent.

Tam Thien Tam divested from Hoa Sen Group as the stock was on a downward trend. The stock had three consecutive sessions of decrease during the last week. At the end of the May 18 session, HSG was around VND14,000.

It has decreased by 22 per cent over a single month to the previous bottom price three years ago. Accordingly, Tam Thien Tam will earn around VND269 billion ($11.85 million) after successfully selling 19.21 million shares.

Several days ago, Tundra Fonder increased its ownership in HSG to over 12 million shares, equivalent to 3.49 per cent. Along with the HSG shares owned by Tundra Sustainable Frontier Opportunities Fund, Tundra Fonder now owns over 18.1 million HSG shares, equivalent to 5.18 per cent, and is a key shareholder at Hoa Sen Group.

Tundra Fonder is a Swedish asset manager specialising in frontier markets and new emerging markets through its Tundra Vietnam Fund, Tundra Pakistan Fund, Tundra Sustainable Frontier Fund, and Tundra Frontier Africa Fund.

In early 2018, Tundra’s growth hit 15.4 per cent, which was the highest growth among its markets in Vietnam, Nigeria, Pakistan, and Sri Lanka. Tundra Vietnam Fund started in May 2014, and total asset value has just reached around $165 million.

Currently, the biggest shareholders of HSG are Hoa Sen Investment Co., Ltd. (25.1 per cent), Hoa Sen Investment and Tourism Co., Ltd. (20.25 per cent), Le Phuoc Vu (10.7 per cent), Tam Thien Tam Co., Ltd. (5.49 per cent), and Tundra Fonder (5.18 per cent).

According to HSG’s business results in the first quarter of 2018, the group’s net profit was only VND115 billion ($5 million), equivalent to 20 per cent of the same period last year, due to increasing costs. HSG gained only VND87 billion ($3.7 million) in profit in the first quarter of 2018, which is the lowest amount within the last four years for this group.

Meanwhile, the liabilities of Hoa Sen Group stood at VND18.436 trillion ($0.8 billion), up VND2.167 trillion ($95.5 million) over the beginning of the year. Thereby, the group has to spend around $100,000 per day for interest payments.