Real estate major Dat Xanh to raise $85 mln from share issuance

In addition to borrowing from banks, Ho Chi Minh City-headquartered real estate developer Dat Xanh Group is implementing plans to offer shares to existing shareholders and via private placement worth VND2,079 billion ($84.84 million).

At the end of September 2023, Dat Xanh, listed on the Ho Chi Minh Stock Exchange (HoSE) as DXG, had total debts of VND5,616 billion ($229.18 million), down VND155 billion ($6.33 million) compared to the beginning of the year. The company had VND759 billion ($30.97 million) in due long-term bank loans and VND472 billion in due bonds.

The Vietnamese group is implementing a plan to offer 102 million shares, or 16.67% of its floating shares, to shareholders. The last registration date for share purchase was December 15, 2023.

With an offering price of VND12,000 ($0.49) per share, the company wants to collect VND1,224 billion ($49.95 million) to contribute capital to Ha An Real Estate Investment and Trading JSC, and supplement capital to Hoi An Investment JSC to pay bond debt and to Ha Thuan Hung Construction-Trading-Services Co., Ltd. to pay off loans and taxes.

At the same time, the group will also make private placements of 57 million shares to foreign investors at a price of VND15,000 ($0.61) per share. The entire proceeds of VND855 billion ($34.89 million) will be used to increase ownership ratio at its subsidiary Dat Xanh Services (HoSE: DXS). In October 2023, the business blocked foreign ownership to serve the share offering plan.

Through share offerings and bank loans, Dat Xanh wants to mobilize a total of about VND6,779 billion ($276.64 million).

The firm has just completed issuing 9 million shares via the Employment Stock Ownership Plan (ESOP) at a price of zero dong to increase capital to VND6,209 billion ($253.38 million). After offering to shareholders, Dat Xanh's charter capital is expected to increase to VND7,230 billion.

Similar to other real estate businesses, Dat Xanh is going through difficult times. In the first nine months of 2023, the company cut nearly 1,300 employees and completed procedures to dissolve a series of subsidiaries.

Its revenue halved to VND2,306 billion ($94.1 million) in the period and net profit plunged 95% to VND20.3 billion ($828,400).

The company has total assets of VND30,499 billion ($1.24 billion), including inventories of VND14,788 billion and receivables of VND11,778 billion.

Closing the Friday session, DXG stood at VND18,800 ($0.77).