Japanese firm Asia Pile Holding, through its member Phan Vu Investment Corporation, will purchase a 51-per cent stake in Fecon Mining Joint Stock Company, the largest pre-stressed concrete pile producer in the north of Vietnam.
Fecon Mining Joint Stock Company (Fecon Mining – stock code: FCM) said that the company will seek its shareholders' opinions on the selection of strategic shareholders in the upcoming general meeting of shareholders.
Fecon Mining said that its strategic partner must be a firm with strong financial resource and expertise in the pile sector.
According to the statement announced, Fecon Mining’s Board of Directors has approved the proposal that Phan Vu Investment Corporation is selected as a strategic investor. Accordingly, Phan Vu will receive 20.9 million of FCM shares, equivalent to a 51-per cent stake. The transaction will be made through the stock market.
Phan Vu was established in 1997 with a charter capital of VND290 billion ($12.5 million) and is a subsidiary of Asia Pile Holdings, a Japanese Corporation specializing in providing pre-stressed concrete piling solutions to developing countries in Asia such as Vietnam and Myanmar.
On the stock market, the price of FCM share was around VND6,000 ($0.26) each. It hit the ceiling yerterday after the information on the strategic shareholder was disclosed.
Fecon Mining was a subsidiary of FECON Corporation, one of the largest underground construction companies in Vietnam. The company is executing projects such as Hoa Phat – Dung Quat Steel complex, VinFast manufacturing plant complex, AEON Ha Dong.
Last year, the company supplied the total length of 1.7 million metres of pre-stressed concrete piles to about 142 projects. The company reported a revenue of VND779 billion ($33.5 million) and after-tax profit of VND30 billion ($1.3 million).
However, Fecon Mining's business results in the first half of 2018 were not satisfactory. Specifically, its after-tax profit was only VND8 billion ($344,530), down 64 per cent year on year. The company explained that its profit dropped sharply due to increase in financial expenses following the divestment in Hai Dang Mining Joint Stock Company.
According to the 2018 business plan, Fecon Mining planned to invest in the research and production of precast concrete products serving for projects regarding response to climate change and sea dike and river embankment worth VND10 billion ($430,663).
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