Shrimp processing line. (Photo Credit: Minh Phu Corporation)

Minh Phu seeks to delist itself from stock market

Vietnamese seafood giant Minh Phu Company (MPC) is delisting itself from the stock market, which has agitated the public opinion and made many shareholders to try to sell their shares, ostensibly after sensing what was to come for the company, a Vietnamese newspaper reported.

This decision to delist the firm was justified by Minh Phu’s senior executives as a result of the pressure from its foreign shareholders, the liquidity and the lack of capital for long-term investment projects.

“Listing is meant to raise funds, but for us it's like being caged,” Minh Phu chairman Le Van Quang said, the Saigon Economic Times reports.

If Minh Phu's planned delisting is approved, the firm will be able to offer private placement to foreign investors by 2014.

The company currently has two foreign investors, Red River Holding and Vietnam Investment Fund, which hold 16 per cent of Minh Phu’s chartered capital. The two biggest shareholders, Le Van Quang and his wife Chu Thi Binh, now hold 48 per cent of stakes, making them the real biggest owners of the seafood firm, VietNamNet Bridge reports.

Despite the delisting, Minh Phu is doing well: its 2012 finance report showed a cash flow of VND 1.260 trillion (USD 59.7 million) in cash and assets.

Some have been guessing that the real reason behind the delisting could be that MPC now wishes to “play the defense.”

A year ago, Thai CP Foods Group showed interest in buying 40 per cent of stakes of Minh Phu. Minh Phu rejected the bid despite its great need for capital, however, because while it was negotiating the contract, Minh Phu obtained some orders -- and mainly because CP Foods tried to set certain terms which showed their intent to eventually take over Minh Phu, which is what MPC’s General Director Le Van Quang wanted to avoid.

Now, sources say that Quang has vowed to retain MPC no matter what and to transfer the company to his daughter.

Meanwhile, many other companies have also been delisting themselves to keep curious big “sharks” in the dark.

In principle, the delisting would harm the companies’ capital mobilization plan and shareholder benefits, as they would find it harder to transfer stocks.

However, some don’t consider it a bad thing, as given that it has become very difficult to seek capital in the stock market, the listing does not bring high benefits.

Related article:

- Minh Phu leads seafood exports in 2012

By Natalia Real
[email protected]
www.seafood.media

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