Vietnam’s largest shrimp producer, Minh Phu, plans to use the funds gained from the sales of stakes to Japan’s Mitsui & Co. to buy a bigger stake in one of its subsidiaries and to pay off corporate debt.
Minh Phu was paid VND 3.038 trillion (USD 130.3 million, EUR 114.6 million) by Mitsui in exchange for 60 million company shares. Of the total, the company expects to use VND 1.755 trillion (USD 75.3 million, EUR 66.2 million) to pay short-term loans; VND 871.8 billion (USD 37.4 million, EUR 32.9 million) to buy a 30.8 percent stake in its Minh Phu Hau Giang subsidiary; nearly VND 315 billion (USD 13.5 million, EUR 11.9 million) to pay off loans for purchased shrimp material and commercial products, and others, according to documents prepared ahead of the company’s stakeholders’ general meeting on 29 June.
The 30.8 percent stake in the Minh Phu Hau Giang that Minh Phu will buy is now owned by Mitsui. The Japanese company wanted to divest the stake to be focusing its resources on the parent company. With the purchase of stake in Minh Phu Hau Giang, Minh Phu will raise its stake in the subsidiary to 98.3 percent, from current 67.5 percent, Minh Phu Chairman and CEO Le Van Quang told SeafoodSource on Thursday. Minh Phu will pay Mitsui VND 32,747 (USD 1.41, EUR 1.24) per share for the 30.8 percent stake in Minh Phu Hau Giang, he added.
In the stakeholders’ general meeting this weekend, Minh Phu will also elect to its board of directors two members from Mitsui to represent its 35.1 percent stake in the Vietnamese producer.
The funds from the stake sales to Mitsui will help Minh Phu improve and expand its business operations, Quang said. After the meeting later this week, the new board of directors and the management team will discuss ways to speed up implementation of new business and production projects, he added.
At present, Minh Phu exports its shrimp products to more than 50 countries and territories worldwide, including the United States, Japan, Canada, the European Union, and South Korea. The company’s shrimp exports surpassed 67,000 tons last year, with sales reaching more than USD 750 million (EUR 662.9 million). Minh Phu operates numerous large integrated shrimp farms located mainly in southern Vietnam, the company’s data shows.
