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Thaco signs strategic cooperation deal with HAGL

Released at: 11:27, 09/08/2018

Thaco signs strategic cooperation deal with HAGL

Photo: VGP News

Strategic cooperation in agriculture and property industries signed on August 8.

by Minh Do

Thaco and Hoang Anh Gia Lai (HAGL) announced the signing of a strategic cooperation agreement in the agriculture and property industries on August 8 in Ho Chi Minh City.

Prime Minister Nguyen Xuan Phuc told the signing ceremony that the joining of Thaco, TH true MILK, Masan, and Loc Troi will contribute to dismissing the myth that agricultural investment does not yield high profits, because if investors have methodical development plans and apply technology they will achieve success.

The two sides also cooperated to invest in two companies - the Hoang Anh Gia Lai International Agricultural JSC (HAGL Agrico-HNG) and HAGL Myanmar Center.

Thaco and its stakeholders own 35 per cent of HNG’s stakes, equivalent to VND3.8 trillion ($163.5 million). According to the agreement, Thaco will be responsible for comprehensively restructuring HNG with total investment of VND12 trillion ($516.5 million). Thaco also commits to restructuring VND14 trillion ($603.2 million) in HAGL debt.

The Dai Quang Minh Real Estate Investment JSC, which owns a 51 per cent stake in HAGL Myanmar Center plans to increase it to 65 per cent. Dai Quang Minh and Thaco will be responsible for investing in the second stage of the HAGL Myanmar project with total estimated capital of $320 million. The project is expected to be completed by 2020.

On August 6, HNG issued a decision to sell 221,688 convertible bonds worth VND10 million ($428) each to Thaco for VND2.2 trillion ($97.3 million).

With a ratio of 1:1,000, Thaco can convert these bonds into 221.688 million shares after one year.

HNG will use VND1.1 trillion ($50.3 million) of the capital acquired to invest in growing bananas and chilis, and the remaining VND1.08 trillion ($47.78 million) on restructuring its operations.

The move is expected to help Thaco get a solid foothold in the agricultural sector. Earlier, in June, HNG offered 221,710 convertible bonds to its existing shareholders, but only sold 22, or a mere 0.01 per cent. Thaco is committed to working with HAGL to develop HNG into a large-scale agricultural corporation, applying high technology and adhering to strict food safety standards.

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