Homepage E-Paper 08-22-2018
VinaCapital announces end of partnership with Ba Huan
Friday,  8/10/2018, 12:32 

VinaCapital announces end of partnership with Ba Huan

By Minh Tam

Phan Thi Huan, owner of Ba Huan Company, inspects eggs on a processing chain. A VinaCapital representative confirms that the partnership with Ba Huan has ended peacefully - PHOTO: BA HUAN JSC

HCMC - VinaCapital Group and Vietnam’s leading poultry egg and meat producer Ba Huan on August 9 completed procedures for the termination of their cooperation deal in the spirit of goodwill, said Don Lam, CEO of VinaCapital Group.

Lam told local media that the two sides had worked together to revoke the deal over the last few days. VinaCapital is willing to cooperate with Ba Huan in the future, he noted.

He also expressed regret over the canceled deal, noting that this is the group’s first deal to be terminated among more than 100 projects VinaCapital has handled over the last 15 years in Vietnam.

He also confirmed that the fund will maintain its investments in private and household businesses as they are the driving force of the economy.

Ba Huan and VinaCapital Vietnam Opportunity Fund (VOF) of VinaCapital Group announced their partnership on February 27, acknowledging that VOF would invest US$32.5 million in Ba Huan. The money was supposed to be used within three to five years to expand Ba Huan’s factories and farms.

The investment was expected to be disbursed within a year, following which VOF planned to invest further.

After the deal was signed, the volume of Ba Huan shares held by its foreign shareholder, Hawke Investment Pte., Ltd, which is VOF’s subsidiary, was raised to more than 9.47 million shares, or 33.77% of the company’s charter capital. VOF also appointed its representative as a member of Ba Huan’s board.

However, early last month, Ba Huan wrote to the Prime Minister asking for help to terminate its agreement with VOF as Ba Huan claimed that some articles in the agreement stated in Vietnamese were different from those in the English version that was initially signed.

Under the deal, Ba Huan was required to ensure an internal rate of return of 22%. The partnership also restricted the poultry egg processor from engaging in business operations other than chicken and eggs.

If the firm could not meet its targets within three years of signing the agreement, it would have to return the investment capital, along with the 22% interest, or transfer a stake of at least 51% to VOF.

On August 7, VinaCapital issued a press release announcing its plan to suspend its investment in Ba Huan.

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