New Gemandept share issuance to finance ports expansion

Gemadept, a leading Vietnamese port and logistics company, plans to issue shares to existing shareholders, with proceeds set to finance the expansion of some port projects.

The firm, listed on Ho Chi Minh Stock Exchange as GMD, will issue more than 100 million shares to existing shareholders at the ratio of 3:1 at the price of VND20,000 per share, about 62% lower than the current market price. The ratio means for every three shares one owns, one can buy one share at that price.

Proceeds from over 100 million shares would amount to VND2,000 billion ($86 million). Of this, VND800 billion would be spent to raise Gemadept’s contribution capital in phase 2 of Nam Dinh Vu Port in Hai Phong city and contribute capital to inland port projects.

Gemadept also plans to use VND1,000 billion to increase capital contribution in Gemandept-Terminal Link Cai Mep Terminal JSC to implement the port’s phase 2 in Ba Ria-Vung Tau province.

In addition, the company will spend the remaining VND209 billion on purchasing fixed assets and developing business activities.

Gemadept’s foreign ownership is now at 42.85%, while the regulated maximum level is 49%.

The corporation’s financial report in the first quarter shows that its net revenue increased 28% over the same period last year to VND879.9 billion ($37.85 million). Of this, VND735.8 billion or 83.6% came from exploitation of ports. The remainder came from other activities like logistics and office leasing.

Its profit after tax was more than VND319 billion ($13.72 million) in the period, a nearly 86% rise year-on-year.

GMD stock closed June 23 at VND63,000 per share. Market capitalization is estimated at more than VND15,800 billion ($680 million).