Vinabico to merge with KDC
By Quoc Hung - The Saigon Times Daily
HCMC - Kinh Do Corp. (KDC) plans to merge with Vinabico and release over 34.11 million shares, the confectioner announced last weekend at its annual general meeting to inform future production activities.
KDC is currently holding a 51% stake in Vinabico and the merger between the two parties will be conducted by stock swap with the ratio of 2.2:1, meaning 2.2 shares of Vinabico can exchange with one share of KDC.
After the merger, Vinabico will become a subsidiary under the umbrella of KDC. Vinabico earned VND75.6 billion in revenue and VND13 billion in after-tax profits last year, according to an audited financial statement.
‘Snack & Confectionary’ is a successful segment at the core of KDC. This year and in the future the corporation will expand its production by adding a ‘Food & Flavor’ segment when launching a series of foods and necessities such as instant noodles and cooking oil.
KDC plans to buy into other companies in an effort to develop its mergers and acquisitions strategy. It aims to find ways to develop the Kinh Do brand outside the country.
The annual general meeting approved to float 34.11 million more shares on the Hochiminh Stock Exchange (HOSE) this year by issuing bonus shares, preferred stock and ordinary shares for Vinabico shareholders.
KDC expects to obtain total revenue of VND5.5 trillion this year, up 30% year-on-year and a pre-tax profit of VND500 billion, up 43% from last year.
The confectionary manufacturer last year earned nearly VND4.25 trillion in overall revenue, increasing 32.6% against 2010. It generated a gross profit of over VND1.67 trillion.