Vinexad building sale faces shareholder doubts
Vinexad building sale faces shareholder doubts
Late last week, Vietnam Trading Expo and Advertising Joint Stock Company (Vinexad) faced strong disagreement from its shareholders over a proposal to sell its office building on Dinh Le Street, next to Hoan Kiem Lake.
The shareholders argued the company’s management board did not provide information on the sale, such as the potential buyer, the price of the building, how its value had been appraised or plans for the capital raised by the sale.
They said the lack of information made them feel the sale was not transparent, or feasible.
According to Nguyen Khac Luan, chairman of Vinexad, the board only wanted in-principle approval from shareholders and then once approved would take the aforementioned steps.
According to some shareholders, the proposal was not in their best interest.
Others claimed that if the proposal was approved, the management board would be given total control of the sale and shareholders would only informed after it was complete.
At a meeting last week held in Hanoi, shareholders required the board to clarify all unanswered questions such as the evaluation of the land area, the assets located on site and the advantages of its central location, as well as many others.
Vinexad has claimed its financial difficulties stem from inefficient operations, caused in part by the building’s old age which makes it undesirable for potential tenants.
The 1,500 square metre building has a lease contract through 2026.
It has been plagued by vacancies since 2013 when the rental market slumped.
Vinexad added that building could not be redesigned as a high-rise as it is faced by the limited height requirements for properties around the lake.
The proposal to sell the building was finally approved by the stakeholders in-principle but the board is required to make a detailed plan which it will propose at the next meeting for further consideration.
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