Vinaconex to issue $173.3 million of bonds

Vinaconex to issue $173.3 million of bonds

The information was released during its annual general meeting of shareholders held on Tuesday in Ha Noi.

The mobilised capital will be used to realise Vinaconex’s ambition to accumulate a land fund of up to 5,000 hectares by 2025, as well as increasing the capital ownership ratio at a number of key member companies with potential development.

The meeting approved the plan to issue convertible bonds worth up to VND2 trillion. These bonds have a par value of VND1 trillion and a four-year term with a maximum interest rate of 12 per cent per year. Expected execution time is in 2021.

Bond owners have the right to convert bonds into Vinaconex shares after at least one year from the date of completion of the offering or at the request of bondholders. The amount of convertible bonds will be decided by the Board of Directors via negotiations with bondholders to ensure shareholders' benefits.

The conversion price will be determined by the Board of Directors, however it must be at least two times higher than the book value in the consolidated financial statements in the latest year and not lower than the par value. The conversion rate has not been decided yet.

Another plan to issue VND2 trillion of bonds to the public was also approved by shareholders. All raised capital will be used to serve business activities and increase capital scale. These bond will be in the non-convertible form, not attached with warrants but attached with collateral.

The meeting also approved a plan to offer more than 58.2 million shares to existing shareholders, equivalent to 14.5 per cent of outstanding shares, for the purpose of increasing capital for business activities.

The management board stated that the expected offering price will not be lower than the book value in accordance with the company's financial statements, however the final price and exercise rate have not been decided.

If the issuance is successful, Vinaconex's charter capital will increase from VND4.42 trillion to VND5 trillion.

This year, Vinaconex hopes to achieve revenue and post-tax profit of VND12.23 trillion and VND1 trillion respectively, up 141 per cent and down 40 per cent, respectively, over the same period last year.

Dividends in 2021 will also be equivalent to 2020 with a rate of 12 per cent in cash.

By the end of the first three months of 2021, the value of the signed construction contracts of Vinaconex was estimated at nearly VND15 trillion, in which there are three outstanding packages of the North - South expressway project in the East, particularly Phan Thiet-Dau Giay, Vinh Hao-Phan Thiet, Mai Son-Highway 45.

This year, Vinaconex continues to focus on completing investment procedures for a number of important projects, speeding up construction of a number of projects including the Cat Ba-Amatina project in the northern province of Hai Phong, luxury apartments on Lang Ha street in Ha Noi and the Hoa Binh Boulevard urban area in the northern province of Mong Cai.

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