Bamboo Capital raises charter capital to $314 mln with successful share offer

Vietnamese private conglomerate Bamboo Capital Group has sold 266.7 million BCG shares, raising its charter capital from VND5,335 billion to VND8,000 trillion ($314.3 million).

The group noted in a release that the sale was successful despite the market price of BCG shares in the issuance period being much lower than the book value and lower than the issue price of VND10,000 ($0.39) per share.

It attributed the success to shareholders being aware of the company's potential. Existing shareholders registered to buy more than 78.3 million shares, helping the company mobilize more than VND783 billion ($30.76 million).

More than 188 million undistributed shares in the first round were purchased by institutional and individual investors who found it worthwhile to invest in Bamboo Capital at VND10,000 per share. These shares will be restricted from transfer for a year, according to the release.

The successful issuance of 266.7 million shares has helped the group access supplementary funds to serve its production and business activities and made its capital commensurate with current asset value, restructuring its debt-to-equity ratio.

Bamboo Capital stated that it has been posting positive business results of late. In the first quarter of 2024, it recorded net revenues of VND985.4 billion ($38.72 million), up 40.5% year-on-year. Its consolidated after-tax profits reached VND98.2 billion ($3.86 million), more than a 10-fold increase year-on-year.

Bamboo Capital's energy arm, BCG Energy, has become a public company and is moving towards trading shares on the Unlisted Public Companies Market (UPCoM) in the third quarter of this year.

With its experience and capacity in developing large-scale renewable energy projects, BCG Energy has struck cooperation agreements with several large international energy corporations including SP Group, Sembcorp, SK Group, Hanwha Group and Leader Energy Group.

On June 10, BCG Energy signed a contract with SK Ecoplant Company, a member of SK Group, the second largest Chaebol in South Korea; and Sudokwon Landfill Site Management Corp, also from South Korea, to develop waste-to-energy projects and waste treatment solutions in southern provinces.

The group said this move concretizes an agreement previously signed by BCG Energy and the Korean Chaebol in March this year.

Another member company of Bamboo Capital, Tracodi, recently signed a cooperation agreement with China Railway Group Limited (CREC) to invest in developing transport and industrial park infrastructure as well as social housing in Vietnam.

CREC, named among the Top 500 largest global enterprises by Forbes, is a general contractor for basic construction projects including railways, roads, halls, metro lines, irrigation works, hydroelectric plants, airports and seaports.

Bamboo Capital stressed that it has been singled out by many international corporations for their Vietnam investments, showcasing increasing appreciation for the Vietnamese conglomerate.

For 2024, the group has targeted consolidated revenues and after-tax profits of VND6.1 trillion ($239.7 million) and VND951.7 billion ($37.4 million), up 152% and 556% year-on-year respectively.

In the 2024-2028 period, Bamboo Capital expects revenue to grow 50% per year to VND30.5 trillion ($1.2 billion) in 2028. Its projected after-tax profits for 2028 is VND4.54 trillion ($178.4 million).

The successful issuance of 266.7 million shares forms an important premise for Bamboo Capital to pursue and achieve its goals in the coming period, delivering better value to shareholders, the group said.

After completing the 2:1 issuance, Bamboo Capital will implement a plan to issue 80 million bonus shares to shareholders at a 100:10 ratio, meaning shareholders owning 100 shares will receive 10 bonus shares.

After the issuance, Bamboo Capital's charter capital will increase further to VND8.8 trillion ($354.74 million).

In the stock market, BCG closed Wednesday at VND9,150 ($0.36) per share, up 1.44% from the previous session.