5/3/2018 – Nawaplastic Industries (Saraburi), a subsidiary of Thailand’s Siam Cement Group (SCG) has registered to purchase an additional 29.51 percent stake in Vietnamese plastic producer Binh Minh Plastic JSC (BMP).
The 29.51 percent stake in BMP represented by 24 million shares previously offloaded by Vietnam’s sovereign wealth fund State Capital Investment Corporation (SCIC) on March 9, starting the divestment exercise which has been much delayed.
The sale of the plastics producer will be implemented through a public auction on the Ho Chi Minh City Stock Exchange (HoSE), at the starting price of VND 96 500 apiece, that is about US$4.26.
For Nawaplastic, this will mean an expenditure of at least VND 2.3 trillion (about US$101.2 million) to acquire the stakes.
However, if successful Nawaplastic will increase its ownership in BMP to 49.91 percent, and thus solidifying its position as the largest stakeholder in the plastic company.
Launched in 1977, Binh Minh Plastics is the country’s leading manufacturer and trader of plastic pipes and fittings. Aside from Nawaplastic, its other investors include Franklin Templeton Investments that owns 10.78 percent.
Previously, Nawaplastic has earlier divested its entire 24 percent stake in Tien Phong Plastic JSC, a competitor of BMP, for more than VND 1.5 trillion (about US$66 million). As of 2017, SCF has invested about US$121 million in Vietnam’s plastic industry.
The Thai group also holds shares in a number of companies specializing in the production of household plastics, including Viet-Thai Plastchem, TPC Vina Chemical and Plastic Corporation, and Minh Thai House Component.
BMP is among the 10 blue-chip companies, alongside Vinamilk and FPT whose auctions were initially scheduled to be held by the end of 2017 but only Vinamilk’s auction plan came to fruition.
Nawaplastic has also shown an interest in increasing its holdings in the company. It is owned by Siam Cement Group’s subsidiary Thai Plastic and Chemicals which owns 70 percent of another Vietnamese plastic company, TPC VINA Plastic and Chemical Corp.