VietNamNet Bridge - In an effort to generate cash flow for debt repayment, Hoang Anh Gia Lai Group will have to sell sugar refineries and possibly sell 20,000 hectares of rubber area to the Chinese.

Hoang Anh Gia Lai Agrico (HNG), a subsidiary of Hoang Anh Gia Lai Group, owned by Doan Nguyen Duc, who was recognized by the international press as one of Vietnam's most influential businessmen, held a 2016 shareholders’ meeting where the board of directors said the company estimated a loss of VND559 billion in 2016. 

HNG’s debt restructuring was one of the key issues of the meeting’s agenda. Ernst & Young, the auditing firm, has warned about the company's continued operation in case the debt restructure cannot be implemented.

HNG now owes VND8.168 trillion to commercial banks and VND10.327 trillion to Hoang Anh Gia Lai holding company, while short-term assets have exceeded short-term loans.

The board of directors has submitted to the shareholders a plan on issuing 110 million shares to strategic investors at the price of VND6,400 per share in order to raise funds to restructure capital and pay VND700 billion to Singaporean Temasek, to which it is owing VND1.1 trillion.

The board of directors has submitted to the shareholders a plan on issuing 110 million shares to strategic investors at the price of VND6,400 per share in order to raise funds to restructure capital.

Duc, president of Hoang Anh Gia Lai and president of HNG, said the board of directors has decided to sell sugar production units, while the negotiations on the sale are getting completed.

Local newspapers days ago quoted their sources as reporting that Hoang Anh Gia Lai would sell its sugar refinery to Thanh Thanh Cong Group, the largest sugar manufacturer in Vietnam. 

Thanh Thanh Cong is also well known in Vietnam, partially because it is owned by Dang Van Thanh, a renowned banker, who was the founder and chair of Sacombank.

Duc went on to say that Hoang Anh Gia Lai is still awaiting the government’s decision on the group’s debt restructuring plan, and that if necessary, HNG will sell its 20,000 hectares of rubber area in Laos. 

He revealed that some Chinese investors want to buy the rubber area for VND8 trillion.

“Hoang Anh Gia Lai Agrico doesn’t go so far as to die,” said HNG’s president.

Meanwhile, there is good news for Hoang Anh Gia Lai that US President Obama has lifted the embargo against Myanmar. This could help boost Myanmar economy, thus benefiting Hoang Anh Gia Lai, which is developing real estate projects in the country.

Hoang Anh Gia Lai still ranks 16th among 50 most valuable Vietnamese brands as reported by Brand Finance.


Kim Chi