Vietnam - The Age Of Hostile Takeover Deals Conducted By Hidden Tycoons

The news about the hostile takeover deals appear repeatedly on local newspapers. Experts say more and more deals would be made, because it is now the right time to acquire other businesses at low prices.

Attacking others to occupy their business bases

Buying or selling businesses is not a new thing in Vietnam at all. A lot of acquisition deals have been carried out in the last few years, in which the new owners of businesses collected the targeted businesses’ shares on the stock market. These included the deal where Hung Vuong bought AGF, or PNj bought SFC, Masan Consumer bought VFC, HT1 merged into HT2 and Mirae into Mirae Fiber.

However, the recent takeover deals seem to go very quietly and unexpectedly, which are considered the hostile takeover. In the current economic difficulties, a lot of enterprises face big difficulties. Meanwhile, the stock prices keep decreasing. These factors all bring the golden opportunities to big businessmen to acquire other businesses.

The war to gain the control over Sacombank, one of the biggest banks in Vietnam, has become the hottest topic among financial experts. Eximbank, also a big bank in Vietnam, has stated that it has obtained enough share proportion to ask Sacombank to restructure of the board of directors. Meanwhile, Sacombank’s managers have denied the information.

The war has not come to an end. However, sources said that the two sides have reached initial agreements on the division of the seats in the board of directors, under which, in the immediate time, Dang Van Thanh would still be the President of Sacombank.

In 2011, the information about the changes in the leadership of Seafood Company No. 1 (SJ1) once stirred up the investors. The president of the company, general director and deputy general director all stepped down at the same time. The takeover was very smooth.

Only at that time did people realize that the process of swallowing SJ1 began one year ago. In the period from March 2010 to May 2011, Tran Van Hau, now President of SJ1, who was then a member of SJ1’s board of directors, gradually increased his share proportion in SJ1 from 7.79 percent to 24.23 percent. Meanwhile, the Hung Hau Development Company, in which Hau was a member of the board of directors, also purchased SJ1 shares in big quantity to become a big shareholder of the seafood company.

It’s difficult to resist the attacks from behind

In 2010 and 2011, the takeover deals which caught the biggest attention from the public were the purchase of Ha Tay Pharmacy in 2010 and the purchase of Descon in 2011.

In the case of Descon, a construction company, at the extraordinary shareholders’ meeting of the company in late 2011, two members of the board of directors–Nguyen Xuan Bang and Nguyen Van Thuong had to leave the posts of the members of the board of directors with 81 percent of votes.

With the statement of holding 35 percent of Descon’s stakes, Binh Thien An Company then took different steps to officially take over Descon. Currently, two out of the five members of the board of directors are the managers of Binh Thien An.

Most recently, the investors whispered into each other’s ears the information that a “big guy” had been quietly collecting nearly 16 percent of the stakes of Sudico, a well known real estate firm on the stock market

After the deal, the big guy showed himself as the one of the 30 richest stock millionaires in Vietnam. He is Do Van Binh, President of Dai Duong finance and construction group with the headquarter in Bac Ninh province. Binh is also the member of the board of directors of Maritime Bank since 2008.

Commenting about the deals, analysts say that the suddenness was the most outstanding feature of the deals, and that when someone is attacked suddenly from behind, he would fall quickly.

Vietnamnet

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