Kido Group (KDC), Vietnam's leading food and cooking oil producer, plans to sell over 22.5 million KDC shares before repurchasing 10 million as treasury shares, equivalent to 3.57% of outstanding shares.
The above information was announced in the document of the company's extraordinary general meeting of shareholders scheduled to take place on December 20.
The transaction is expected to be executed through order matching and/or agreement in 2023, after the State Securities Commission announces that all documents have been received.
On its Q3 consolidated financial statement, the number of treasury shares held by Kido is recorded at more than VND865 billion ($36.31 million), equivalent to the average buying price of VND38,400 ($1.63) per unit.
KDC shares were VND61,500 ($2.6) per unit at the closing session on Friday, 60% higher than the average buying price mentioned above. At this price, Kido may have to spend VND615 billion ($26 million) to buy back 10 million KDC shares, and at the same time earn more than VND1,300 billion ($55.14 million) from selling all its treasury shares.
After these transactions, Kido's charter capital will decrease to VND2,697 billion ($114.4 million) from VND2,797.4 billion.
According to Kido, KDC's stock price has not yet fully reflected the actual value as well as the company's development potential, therefore, it wants to buy back to stabilize the share price.
In Q3, the company recorded a net revenue and after-tax profit of nearly VND3,300 billion ($140 million) and VND30 billion ($1.27 million), up 26.2% and down 76% year-on-year, respectively.
In the first nine months of the year, Kido reported a net revenue of VND9,569 billion ($406 million) and after-tax profit of VND487.7 billion ($20.69 million), up 29% and down 24% year-on-year, respectively.
In November, Kido had entirely divested from Calofic Corporation - owner of many cooking oil brands like Neptune, Simply, and Meizan, to restructure its cooking oil segment. Accordingly, Vietnam Vegetable Oils Industry Corporation, a subsidiary of Kido, transferred its entire 24% stake at Calofic to Siteki Investment for nearly VND2,158 billion ($86.99 million).
After the deal, Kido Group only owns a single cooking oil brand with a large market share, TuongAn Vegetable Oil JSC (TAC).