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Banking & Finance

Taisho to secure further 7.06% of DHG

Released at: 08:00, 08/07/2018

Taisho to secure further 7.06% of DHG

Photo: DHG

Japanese pharma company to make public offer for just over 9 million more shares.

by Minh Do

Japan’s Taisho Pharmaceutical Holdings is to purchase an additional 7.06 per cent of Vietnam’s Hau Giang Pharmaceuticals JSC (DHG), lifting its ownership from 24.94 to 32 per cent, according to the Ho Chi Minh Stock Exchange.

Taisho currently holds 32,606,096 shares with voting rights and plans to make a public offer for 9,232,647 shares with voting rights, for a total of 41,838,743.

According to DHG, the price proposed is VND120,000 ($5.2) per share. Within 30 to 60 days of receiving written approval from the State Securities Commission, Taisho will disclose relevant information in accordance with the law. The assigned agent is SaiGon Securities Incorporation (SSI).

DHG recently announced its foreign ownership limit will be raised to 100 per cent from July 4.

In March 2016, DHG had three major shareholders: the State Capital Investment Corporation (SCIC), with a 43.31 per cent stake, Franklin Templeton Investment Funds - Templetion Frontier Markets Fund with 9.44 per cent, and Portal Global Limited with 7.2 per cent. While Portal Global Limited sold its stake to Taisho at around that time, the other two shareholders are yet to announce any change in their holding.

Taisho acquired more than 21.3 million shares, or 24.4 per cent, of DHG in July 2016 from 34 foreign shareholders. The value of the deal was not disclosed, but based on June 30, 2017 data, at a price of VND103,000 ($4.52) the deal was worth nearly VND2.2 trillion ($98 million).

Taisho has committed to enhancing its pharmaceutical business in Asia and is endeavoring to expand to various business segments in the continually growing Asian market.

Headquartered in Tokyo, Taisho Pharmaceuticals is a leading Japanese pharmaceutical company specializing in the manufacturing of pharmaceutical products and non-prescription dietary supplements with well-known brands.

In Southeast Asia, Lipovitan-D (a vitamin-rich energy drink) is the company’s most famous brand. In 2015, the parent company recorded revenue of $2.7 billion and after-tax profit of $210 million. It founded an $11.8-million investment company in Vietnam in 1999 that manufactures and distributes Lipovitan drinks.

Elsewhere in Vietnam’s pharmaceutical sector, South Korea’s Celtrion Group has also identified opportunities to enter the market.

At a working session with leaders of the Binh Duong Provincial People’s Committee on May 8, Chang Sin Jae, General Director of the Celtrion Group, said it intends to develop a pharmaceutical manufacturing plant triple the scale of its existing factories in South Korea, Europe, and North America.

The plant is estimated to have total investment of $800 million and a capacity of 360,000 liters of water-based medicine. The company expects to secure a license in short order.

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