What lies behind T&T interest in Vinafood 2?

Do Quang Hien, chairman of the Board of Directors cum general director of T&T Group

Recently, T&T Group expressed interest in buying the 125 million shares (representing 25 per cent of the charter capital) on offer to become the strategic investor of Vinafood 2. This movement, makes the public think that T&T is going mainly for the golden land plots held by Vinafood 2, while acquiring the company would be a good basis for the group to set foot in the agricultural sector.

T&T group operates in numerous sectors, including property, finance, industry, sports investments, and import-export trading. Besides, on February 6, 2018, T&T Group and Boskalis Group from Netherlands signed an agreement to co-operate in the seaport sector.

Furthermore, T&T invested in a series of domestic agricultural firms, including Vietnam General of Agriculture Material Corporation Limited (Vigecam), Vietnam National Vegetable, Fruit and Agricultural Product Corporation JSC, and Hanoi Trade Corporation.

According to the latest developments, T&T signed the agreement to co-operate with P.Marom, a firm operating in greenhouse technology from Israel, and Enza Zaden, a firm with 80 years of experience in the agricultural sector from Netherlands. Accordingly, on January 22, 2018, T&T launched the agricultural brand T.Vita with the support of the two foreign partners.

According to plan, T&T offered two agricultural projects in the northern province of Bac Giang, including the T.Vita hi-tech model farming project in Phuc Son commune, Tan Yen district, and the T.Vita hi-tech agricultural product processing project whose location is to be introduced by the local authority.

Firstly, the model farming project was planned to be raised on an area of 100-150 hectares to grow high-quality vegetables and fruits. The project would apply modern technologies, such as glasshouse, membrane house, auto irrigation and fertiliser supply systems (imported from the Netherlands, France, and others).

Secondly, T&T proposed to execute the second project with the scale of 5-10ha to process various vegetables and fruits.

At present, T&T’s revenue from the agricultural sector stands at hundreds of million dollars each year. Thus, acquiring Vinafood 2 will open opportunities for T&T to increase its revenue from this sector.

Regarding Vinafood 2’s golden land plots, the company currently holds 146 large-scale land plots in Ho Chi Minh City, Can Tho, Long An, and Ben Tre, with a total area of 3.405 million square kilometres. In Ho Chi Minh City alone, it owns 17 land plots with a total area of 89,842 square metres. Vinafood 2 used part of this area to develop real estate projects, while, T&T hasbeen looking for land plots to implement its projects.

According to the approved equitisation plan, Vinafood 2 is permitted to hold 2.106 million sq.m after the equitisation. Thus, if T&T successfully becomes the strategic investor, it will hold part of this area.

According to the latest information, to date, T&T is the only candidate for the strategic investor position, thus it is quite sure that T&T’s designs will find fruition.