Gelex estimated to spend nearly 2,000 billion dong to buy 95 million Viglacera shares
General Electric Equipment Joint Stock Corporation (Gelex, GEX code) has just approved the plan to make a public bid for Viglacera Corporation’s shares to increase its ownership from the current 24.96% to 46.15%, Gelex will offer to buy 95 million shares at a price not lower than the reference price 60 days prior to the date of submission of the tender offer registration. The specific bid price shall be decided by the General Director at the time of registering a public bid with the competent agency.
VGC shares hit the ceiling price after this information, currently closing at 20,900 dong / share. Estimated at the above price, Gelex needs to spend 1,985.5 billion dong. This amount is equivalent to 8.8% of asset size (VND 22,506 billion). By the end of the first quarter of 2020, Gelex has 625 billion in cash and cash equivalents. In addition, this enterprise also invested nearly VND 1,000 billion in bonds of the two businesses.
The time of the bid offer and the expected deadline for completion of the tender offer are from 30 to 60 days after obtaining the State Securities Commission’s written approval of the tender and Gelex shall disclose information as prescribed under the law.
At the annual General Meeting of Shareholders held in mid-June, the representative of the Ministry of Construction said that if actively deploying the divestment can be done in November 12 this year. Equitisation of Viglacera has completed the stage of handing over State capital to the joint stock company.
Recently, the Prime Minister issued Decision 908 to replace Decision 1232 in 2017 on the list of state-owned enterprises that are divested. Viglacera is in the group of 18 businesses required to send the Prime Minister specific divestment plans before July 31.
According to the old decision, the Ministry of Construction will still hold 20% of Viglacera’s capital. However, according to the ministry’s representative at the Congress, Viglacera is expected to no longer have State shareholders. The Ministry of Construction may divest all capital here.
Although Gelex has not announced a specific time for buying, this purchase of shares is likely to be implemented before the divestment of the Ministry of Construction. If the tender succeeds, Gelex only needs to buy an additional 5% of capital from the Ministry of Construction to own Viglacera with a controlling stake.
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