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VRG to launch IPO in December

Ngoc Hung
Tuesday,  Sep 26,2017,23:38 (GMT+7)
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VRG to launch IPO in December

Ngoc Hung

HCMC - Vietnam Rubber Group (VRG) has plans to launch its initial public offering (IPO) in December 2017 to sell an 11.88% stake, equivalent to 475 million shares.

The group on September 25 organized a meeting to discuss options for equitization before passing such options to competent agencies for approval.

VRG has plans to offer IPO shares at VND13,000 (US$0.57) each. However, it will need the Prime Minister’s permission before making the final decision on pricing and conducting the IPO.

After the IPO, VRG’s shares will be sold to its workers at a price 40% lower than the lowest winning bid.
Strategic investors that acquire VRG’s shares must be domestic enterprises having average chartered capital of at least VND5 trillion (about US$220 million) in the past five years, posting after-tax profits in the past three years and not having accumulated losses as of December 31, 2016. For domestic enterprises active in the rubber sector, they are required to have average chartered capital of at least VND1 trillion in the past five years.

According to Tran Ngoc Thuan, general director of VRG, the group has completed necessary preparations and is waiting for the Prime Minister’s approval. However, the IPO plan would be postponed until the first quarter of 2018 if there are big adjustments.

Thuan said after equitization, VRG’s management board and operation will be kept unchanged. 
VRG earlier intended to launch its IPO on July 1, 2017. However, the plan was canceled due to delays in corporate evaluation.

According to VRG’s report, the group has been valued at over VND49.2 trillion (over US$2.16 billion), including nearly VND47.3 trillion of State capital.

VRG used to be a multi-sector group investing in a wide range of sectors, from rubber production and trade to hydropower, steel, cement and finance. However, the group is now focusing on its core businesses, including planting rubber trees, processing and selling rubber, developing industrial zones on land that used to be rubber farms, and hi-tech agriculture.

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