Hoang Anh Gia Lai, one of Vietnam’s largest private sector conglomerates, is planning to raise up to $70m through a secondary listing in London, which would make it the first big Vietnamese company to sell shares overseas.
HAGL has enlisted Elara Capital, a small Indian investment bank, to handle the sale of global depositary receipts, according to a memo seen by the Financial Times.
The company started life as a furniture manufacturer, but has been transformed into one of the country’s largest property developers by founder and majority owner Doan Nguyen Duc, one of Vietnam’s richest men.
A number of Vietnam’s biggest listed companies, including dairy group Vinamilk and lender PetroVietnam Finance, have been looking to complete secondary listings in Singapore. But their plans are on hold because of the global financial crisis.
The main stock market in communist-run Vietnam, the Ho Chi Minh Stock Exchange, is only 10 years old and just a handful of pioneer foreign investors have bought shares on it given the market’s size, lack of liquidity and concerns about corporate governance.
Vietnamese companies and investors hope the first foreign listings will provide a much-needed impetus to the market, which is one of Asia’s worst performers this year, down 14 per cent since January amid worries about high inflation.
“If HAGL are successful, other companies will be more confident to list overseas,” said Vo Truong Son, deputy general director of HAGL.
HAGL plans to sell 19m new shares at 72,000 Vietnam dong each, generating about $70m before costs at the current interbank exchange rate. The company will use the proceeds to boost its investments in rubber plantations and hydroelectric power.
Mr Son said the share sale had been approved by the Vietnamese market regulator and it was “highly probable” that the company would be able to close the transaction by Wednesday.
A person familiar with the deal said there had been “a lot of interest from UK and US institutional investors”. But he warned the issue could be delayed until early next year unless it was wrapped up by Wednesday, which is the record date for an issue of bonus shares.
The GDRs will be traded on the London Stock Exchange’s international order book. Deutsche Bank will act as the custodian and depositary. HAGL’s shares closed on Friday at 77,000 Vietnam dong, giving the company a market capitalisation of about $1.2bn.
(By Ben Bland in Hanoi)
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