After becoming prosperous as a taxi firm, Mai Linh decided to invest in real estate. It mobilized VND500 billion from 800 individuals at an interest rate of 18-25 percent, mostly short term (1-2 year), for the investment. 

Ho Huy, chair of Mai Linh, said the company thought it would buy real estate when the prices were low and sell when the prices went up for profit. But things didn't go as expected.

Mai Linh then vowed to carry out restructuring. Its subsidiaries became dependent branches, sold properties, and used leased head offices, which helped save money and manage the capital. 

For years, the debt burden continued. The situation became worse in 2018 and 2019. Its consolidated financial statement in 2021 showed a post-tax loss of VND271 billion, up by VND185 billion year-on-year.

Apax Holdings, a subsidiary of Egroup, once announced an investment strategy in educational real estate. This was seen in the purchase of more than 7,000 sqm of land in Vinh Tuy, Hanoi in 2019 to build a school with different education levels.

On its website, Apax Holding said that it mobilized VND300 billion for a real estate project in Hong Quang Long Hai tourism complex in Vung Tau City, Ba Ria - Vung Tau province.

According to the company’s Q3/2022 finance report, it has VND423 billion explained as a deposit for cooperation with partners to build and develop the Vung Ang housing and multi-functional service zone in Vung Ang Economic Zone (EZ) in Ha Tinh Province. 

The deposit time was 450 days, and the deposit was extended until December 31, 2022.

Since early November 2022, the price of IBC shares of Apax Holdings has fallen to the floor. 

Its Q3/2022 finance report shows liabilities of VND3 trillion. The debt is high compared with its charter capital of VND830 billion.

The restructuring of Apax English began after the system faced trouble from investors. Apax English is a subsidiary of Apax Holdings (IBC) with the holding stake of 66 percent.

“Gathering strength and focusing on the core business field": that is the lesson that Thuy has learned.

Phan Xuan Can, a consultancy expert, observed that businesses can move from another field to the real estate sector but the real estate field is not an appropriate one for all investors.

Duy Anh