VietNamNet Bridge - Many Vietnamese plastics firms have fallen into foreign hands, while others are in a state of anxious suspense because they may be swallowed up one day. 

In early March 2017, nearly 15 million shares of Tan Tien plastic packaging Company were put back into transaction on UpCom after the voluntary delisting on the HCMC Stock Exchange in October 2015. 

A big shareholder, Dongwon Systems Corporations from South Korea, holds 93 percent of Tan Tien’s shares.

Before being fully acquired, Le Minh Cuong, president and general director of Tan Tien, who once held 23 percent of the company’s stakes, tried to collect shares with all of his financial resources in an effort to retain control over the company. However, it was too late.

With the price of VND57,000 per share in mid-2015, the South Korean corporation spent VND800 billion to swallow up the company.

Many Vietnamese plastics firms have fallen into foreign hands, while others are in a state of anxious suspense because they may be swallowed up one day.

Analysts commented that the hostile takeover deal has ‘shaken’ the entire plastics industry. 

After the change of ownership, Tan Tien reported revenue of VND1.405 trillion, which was equal to 2015, but the post-tax profits soared to VND105.5 billion, an increase of 74 percent compared with the year before.

The company plans to obtain revenue of VND1.771 trillion and post-tax profits of VND164 billion in 2017, an increase of 55 percent over 2016.

Tan Tien is not the only company which has fallen into foreign hands. After Tan Tien, the South Korean corporation has also taken over Minh Viet Plastic Packaging. Meanwhile, Siam Cement Group (SCG) completed the deal of buying 80 percent of stakes of Batico at 1.5 billion baht, or $44.4 million, or VND932 billion.

Batico is also a large plastic manufacturer, listed among top five Vietnamese plastic packaging companies.

Batico is not the only plastic company SCG aims for. The Thai giant has been trying to penetrate more deeply into the Vietnam’s plastics industry when buying 20 percent of Binh Minh Plastics and 25 percent of Tien Phong Plastics. 

The two companies now hold 50 percent of the structural plastics market share.

An analyst noted that SCG alone has spent $121 million to invest in seven Vietnamese plastics companies. Besides the companies, SCG also holds stakes in Plastchem, TPC Vina, Chemtech and Minh Thai Plastic Material Company.

He said if SCG successfully takes over Binh Minh and Tien Phong Plastics, it will dominate the structural plastic industry in Vietnam.

At a recent workshop, the representative of Binh Minh Plastics Company expressed his concern about the new regulation allowing foreign investors to hold up to 100 percent of stakes of Vietnamese companies, saying that this will turn a Vietnamese brand into a 100 percent foreign owned company.

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