Japanese pharmaceutical giant ASKA to up stake in Vietnam drug maker DHT

Japan’s century-old ASKA Pharmaceutical Co., Ltd plans to increase its stake in Ha Tay Pharmaceutical JSC, traded on the Hanoi Stock Exchange as DHT, to 33%.

For this, it would acquire an addtional 11.36% stake in a private placement.

According to a DHT decision, the company will issue 8.4 million new shares at VND21,500 ($0.87) each to ASKA Pharmaceutical for a transaction value of VND181 billion ($7.4 million).

DHT will invest VND78 billion ($3.19 million) of the proceeds in a new high-tech medicine factory and the rest to restructure its bank loans.

After the transaction, ASKA Pharmaceutical will hold 26.8 million DHT shares, or a 33% stake. The acquisition is part of the former’s plan to expand its footprint in Southeast Asia.

The foreign ownership limit in DHT has been set at 50% by Vietnam’s stock market regulator.

In early 2021, ASKA Pharmaceutical completed a deal to buy 6.6 million DHT shares for a 24.9% stake, making it the largest shareholder in the Vietnamese firm. In June 2023, ASKA Pharmaceutical’s holding increased to 18.4 million shares after a bonus dividend.

DHT earned a pre-tax profit of VND73 billion ($3 million) on revenues of VND1.31 trillion ($53.57 million) in the first eight months of this year, the firm said in a statement.

The DHT share closed Friday up 6.13% at VND22,500 ($0.92).

Established in 1920, ASKA Pharmaceutical has set up several joint ventures overseas including one with India’s Omnicare Drugs India Pvt. Ltd for drug production. The Japanese firm holds a 30% stake and the Indian partner the remainder.

The value of Vietnam’s pharmaceutical industry is forecast to reach $8 billion this year, up from $7 billion in 2022 including imports worth $3.2 billion.

Foreign investors have made big investments in several Vietnamese pharmaceutical firms including Hau Giang Pharmaceutical (DHG), Domesco (DMC), Traphaco (TRA), Imexpharm (IMP) and Pymepharco (PME).