September 07, 2008

BIDV financial arm to take stake in Asia Huu Lien’s steel mill

Vietnam Economic Times reported that The Bank for Investment and Development of Viet Nam’s Financial Investment Joint Stock Company has signed a contract on November 16 to become a strategic partner of the Ho Chi Minh City based Asia Huu Lien Joint Stock Company. Under the contract, BFC will acquire 7.5% of the steel firm, whose chartered capital stands at VND 200 billion (USD 12.2 million).

Mr Vu Truong An deputy GD said that “BFC is a professional financial investor working in areas including consultancy on listing on the stock exchange, real estate business and investment portfolios. Therefore, its expertise will benefit our development plans.”

The capacity of the existing factory is 6,000 tonnes per month and is expected to rise to 10,000 tonnes so that the company can increase its market share in Viet Nam to 25% in five years, from the current 10%.

Mr Tran Tuan Nghiep GM said that procedures will begin early 2008 for his company to get on the board of the Ho Chi Minh City Stock Exchange by year’s end. After listing, it would double its chartered capital to VND 400 billion. This year the company hopes to earn VND 25 billion in net profit up by 10% YoY. He added that the company is also negotiating with a foreign finance firm that would like to become a major shareholder.

Asia Huu Lien also plans to develop a 100 hectare industrial park in Long Thanh district in Dong Nai Province, with an estimated investment of VND 100 billion. Some space in the park will be allocated for building a new factory to replace its current factory in Ho Chi Minh City’s Binh Tan District. A residential project will be developed at its site in Binh Tan, which covers around 5 hectare. Both the IP and residential projects are slated to begin next year.