An Giang Fisheries Import and Export Co (Agifish), listed on the HCM City Stock Exchange under the code AGF, has endorsed a public offer by Hung Vuong Co to purchase 3.75 million AGF shares, equivalent to over 29-per-cent stake in the company.
The nation’s leading exporter of tra and basa fish, Hung Vuong (HVG), already holds a nearly 22-per-cent stake as a strategic partner in Agifish. Its January 4 offer is part of an overall plan to take a controlling interest in the rival seafood processor.
Agifish Chairman Ngo Phuoc Hau said he was not surprised at Hung Vuong’s offer, commenting, "The two companies are top local pangasius exporters and this combination will promote our mutual benefit."
Agifish’s export markets are primarily in Western Europe, the US and Australia,while Hung Vuong exports to Russia, Ukraine, Mexico and the East.
"Agifish has the advantage of a long-established presence in the US market which our company wants to exploit," said Hung Vuong’s financial officer Phan Huynh. "In return, Agifish can take advantage of our traditional markets in Mexico and Ukraine."
The two companies also have close business ties, with Hung Vuong’s two fish feed plants providing feed materials to Agifish.
Under Vietnamese securities regulations, any institution or individual which holds a stake of 25 percent or more in a public company is required to make a public offer to purchase shares to increase its holdings to 51 percent and over. Hung Vuong was waiting for approval from the State Securities Commission of the purchase, said Huynh, and the company expected to complete the acquisition of shares within 30-60 days of receiving the approval.
The offer price was initially projected at VND36,000 (US$2) per share but would be adjusted to reflect market developments, Huynh said. AGF shares yesterday closed at VND35,000 ($1.9) on the HCM City Stock Exchange.
Agifish’s export value was nearly $60 million last year and its net profit reached VND14.3 billion ($760,638). Hung Vuong exported an estimated $180 million and posted a net profit of VND330 billion ($17.6 million) in 2009. HVG shares ended yesterday’s trading at VND52,500 ($2.8).
If Hung Vuong succeeds in the acquisition bid, it will mark Viet Nam’s first acquisition completed through public offer on the stock exchange.