VietNamNet Bridge – The year of dragon, the bad year for many Vietnamese businessmen is over. However, the debts still exist, and the big tycoons still have to manage to earn money to pay debts.

VND2 trillion worth of debts and VND75 billion in capitalization value

Thai Hoa was once a colossal coffee company in Vietnam with the total assets of up to VND2 trillion and the turnover of VND3.3 trillion. However, the huge business has turned small with the total assets of VND1 trillion and the market capitalization value of VND75 billion only.

The misfortune rushed down in late 2011, but the problems of Thai Hoa only got exposed in 2012, when the business was found as unable to pay the bank debts worth hundreds of billions of dong.

Since Thai Hoa’s President--Nguyen Van An, continuously incurred loss, his debts have heaped up. In 2011, Thai Hoa took a loss of VND210 billion. Meanwhile, over the last four consecutive quarters, by the end of the third quarter of 2012, Thai Hoa had incurred the loss of VND523.7 billion, the level which nearly hit the VND577.5 billion threshold in chartered capital, thus facing the risk of compulsory delisting.

Not only Thai Hoa, a series of other farm produce exporters, which operate in one of the key economic sectors, have also been on the verge of bankruptcy, namely Bianfishco, Phuong Nam and Dong Nam Seafood Companies.

The previous owner of Bianfishco, Nguyen Thi Dieu Hien, left a huge debt of VND1.8 trillion and interminable debts. Bianfisco was only saved after SHB became a big shareholder and agreed to pour money into the company to resume the production.

Phuong Nam seafood company, which was once listed in the top 10 seafood exporters, reportedly incurs the debt of VND1.6 trillion. In late 2012, Dong Nam, another giant in the field, was also found as incurring the debt of hundreds of billions of dong.

Hoang Anh Gia Lai, a once powerful conglomerate in Vietnam, though having made heavy investments in the fields of rubber plantation, sugar, hydropower and real estate, have raised big worries about the debts worth tens of trillions of dong.

Analysts say Hoang Anh Gia Lai would begin collecting money from its rubber projects in 2013. However, the money would not be big to pay debts, while the conglomerate still needs much more money to run the plan to grow 51,000 hectares of rubber.

Struggling to pay debts and survive

Over the last year, Thai Hoa has been trying to contact all the bank creditors to discuss the extension of the debt payment and ask for new loans.

According to Nguyen Van An, the President of Thai Hoa, who has used his own assets to support Thai Hoa’s business, Thai Hoa has got the support from many credit institutions and its partners. Besides, An keeps optimistic about the plan to issue shares at the prices lower than the face value.

Besides, Thai Hoa, an enterprise in the agriculture sector, is likely to receive the support from the State. This makes people believe that though the recovery could not be made overnight, the most difficult period of Thia Hoa is over.

In case of Phuong Nam, the seafood company has begun the negotiations with the creditors on the debt restructuring without having to bring the case to the court.

As for Hoang Anh Gia Lai, its President--Doan Nguyen Duc, has informed that the sugar refinery in Laos has become operational. If everything goes smoothly, the sugar refinery and the 30MW thermopower plant would bring VND1 trillion to Hoang Anh Gia Lai in 2013.

Ngoc Dung