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Once the richest man in Vietnam and successful in many fields, Duc now faces many difficulties.
HAGL Group completed the negotiated sale of nearly 80 million shares of HAGL Agrico (HNG) from May 7 to June 5, thereby reducing the ownership ratio from 258 million shares (23.28% of capital) to 178 million shares (16.07% of capital).
At the current price of about VND10,500 per share, HAGL Group has earned about VND850 billion from this.
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HAGL Group Chairman Doan Nguyen Duc. |
Previously, HAGL Group divested capital from HAGL Agrico. From late March to late April, HAGL sold more than 72 million shares of HAGL Agrico, earning about VND870 billion. In 2020, HAGL also sold hundreds of millions of HAGL Agrico shares.
This was an act of business restructuring to pay debts at the bank.
For many years, Duc's HAGL Group has had heavy debt and heavy losses. In late February 2021, HAGL recorded an accumulated loss of VND 5,000 billion due to an increase in provision for bad debts.
In the 2019 audited financial statements, Ernst & Young Vietnam gave an exception due to the inability to collect sufficient evidence to determine the recoverability of the outstanding loan balance of VND 5,669 billion (by December 31, 2019) of the total value of short-term and long-term receivables of VND10,505 billion.
In early 2017, HAGL Group caused a stir when retroactively adjusting the business results of 2016 related to the sale of HAGL Sugar.
Most of Duc's corporate assets were sold to Thaco billionaire Tran Ba Duong after HAGL and Thaco inked a strategic cooperation deal in mid-2018.
In early 2021, Thaco officially assumed the key role at HAGL Agrico (HNG).
HAGL Agrico was established in 2010, focusing on growing industrial crops such as rubber trees and palm trees with a total area of tens of thousands of hectares of land in Indochina.
HAGL Agrico was a testament to Duc’s ambition to build a leading agricultural empire in Southeast Asia. However, Duc encountered many difficulties with this project.
After 10 years of moving from real estate to many fields of business and ending up in agriculture, Duc still faces problems.
The past decade was perhaps the most stressful and difficult period for Duc's HAGL Group. Several times, Duc’s corporation was on the verge of bankruptcy. From the position of the richest businessman on the stock market of Vietnam in 2008, Duc plummeted out of the top 80.
His agriculture business is no longer under Duc's control. Duc has sold his sugar and rubber companies and abandoned a cow raising project.
At the present time, HAGL Agrico only has strength in the field of fruit trees. However, Duc's position in this firm has declined after selling a large number of shares.
The process of corporate restructuring is still ongoing, and the debt burden of HAGL has been greatly reduced.
Duc is still famous in the field of football with the breakthrough of HAGL FC after employing Thai football star Kiatisuk as its head coach and HAGL FC’s contributions to the Vietnamese national football team in the World Cup qualifiers.
HAGL Agrico has adjusted its business targets for 2021 due to the impact of the COVID-19, causing a plunge in the output and quality of fruit and rubber products.
The new targets were announced at the annual shareholders' meeting of International Agriculture Hoang Anh Gia Lai JSC (HAGL Agrico) on June 4.
HAGL Agrico has forecast a revenue of VND1.46 trillion ($63.5 million) and an overall loss of VND84 billion ($3.65 million) this year, a significant reduction from the VND2.1 trillion ($91.3 million) and VND16 billion ($695,650) set at the extraordinary shareholder meeting in January.
The representative of the Board of Directors explained that the disruptions of the COVID-19 pandemic in Laos and Cambodia caused difficulties in transporting agricultural equipment to the group's farms. The technical staff, employees, and contractors working on its projects under construction also had to be isolated when they crossed the border, extending timelines and expenditures.
Besides, the lack of capital and employees (due to lack of finances to to pay wages) made the capacity and quality of products plunge. Additionally, many of the group's fruit farms lacked water for irrigation because the water and electricity infrastructure systems did not meet technical quality standards.
In 2020, the group reportrf a 31 per cent increase in net revenue to VND2.37 trillion ($103 million) with VND21 billion ($913,040) of after-tax profit.
HAGL Agrico currently manages 335,749 hectares of land, including 27,376ha in Laos to grow banana and pineapple and 8,373ha in Cambodia to grow banana, mango, and jackfruit.
This year, the group expects to invest VND1.024 trillion ($44.5 million) to enhance the quality of its cultivating area and fruit farms. VNA
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