Struggling to "close" the "reverse" M&A deal at Quy Nhon Port

Nearly 6 years after the Government Inspectorate issued Conclusion No. 1566/KL-TTCP on the equitization of Quy Nhon Port Joint Stock Company, Vietnam National Shipping Lines has not been able to completely resolve issues related to the recovery of 75.01% of Quy Nhon Port shares to state ownership.

Nearly 6 years after the Government Inspectorate issued Conclusion No. 1566/KL-TTCP on the equitization of Quy Nhon Port Joint Stock Company, Vietnam National Shipping Lines has not been able to completely resolve issues related to the recovery of 75.01% of Quy Nhon Port shares to state ownership.

Vietnam National Shipping Lines is struggling to recover 75.01% of Quy Nhon Port shares.

Can't finish yet

Vietnam National Shipping Lines - JSC (VIMC) has sent Official Dispatch No. 203/HHVN - DT to the Ministry of Transport (now the Ministry of Construction) - the unit that acted as the owner's representative in the period before 2018, to report the results of the implementation of Inspection Conclusion No. 1566/KL-TTCP dated September 17, 2018 of the Government Inspectorate on the equitization of Quy Nhon Port Joint Stock Company.

Mr. Pham Anh Tuan, Deputy General Director of VIMC, said that up to this point, there is only one content of the proposed handling requested by the Government Inspectorate, but it has not been able to be completely handled, related to the payment of legal benefits to Hop Thanh Investment and Mineral Joint Stock Company according to the Transfer Contract.

It should be added that, in Inspection Conclusion No. 1566/KL-TTCP, the Government Inspectorate affirmed that the equitization and divestment of all state capital at Quy Nhon Port Joint Stock Company was not in accordance with the Restructuring Project of Vietnam National Shipping Lines - Vinalines (now VIMC) for the period 2012 - 2015.

The Government Inspectorate recommended that 75.01% of the shares that Vinalines transferred to Hop Thanh Investment and Mineral Joint Stock Company must be recovered to state ownership; organizations and individuals with shortcomings and violations must be strictly handled according to the provisions of law.

In May 2019, VIMC spent VND415.5 billion to pay Hop Thanh Investment and Mineral Joint Stock Company to re-own more than 30.3 million shares, equivalent to 75.01% of the charter capital of Quy Nhon Port Joint Stock Company, marking the fundamental implementation of the Government Inspectorate's recommendation to recover 75.01% of Quy Nhon Port shares to state ownership.

However, according to Inspection Conclusion No. 1566, the recovery of 75.01% of Quy Nhon Port shares also includes the payment of the value of the investor's legitimate interests. The value of this legitimate interest is also stipulated by the parties in the Contract for transferring ownership of 30.3 million Quy Nhon Port shares from Hop Thanh Investment and Mineral Joint Stock Company to VIMC.

According to VIMC's initial calculation, the time to calculate investors' benefits is determined from September 2015 (the time when Hop Thanh Investment and Mineral Joint Stock Company took over the management and operation of Quy Nhon Port) to May 29, 2019 (the time when VIMC officially recorded the ownership of 75.01% of charter capital at Quy Nhon Port Joint Stock Company as determined by the Vietnam Securities Depository Center).

Long-standing debt

VIMC leaders said that at the end of September 2022, this unit and DQ Law Firm (representing Hop Thanh Investment and Minerals Joint Stock Company) met and agreed on a number of contents to implement the determination of the legal value of the investor according to the Transfer Contract.

Accordingly, the two parties agreed to select and determine the time of June 30, 2019 to apply for the construction and calculation of the value of the legal benefits of the investor (Hop Thanh Investment and Minerals Joint Stock Company) in the period from September 2015 to June 30, 2019.

In addition, at point 4.4, Article 4, the Quy Nhon Port Joint Stock Company Share Transfer Contract stipulates that Party B (ie Hop Thanh Investment and Minerals Joint Stock Company) has the right to provide the basis, method of determination and value of the investor's legitimate interests, VIMC will consider, approve or ask for guidance as the basis for the two parties to agree and implement.

Party A agrees to facilitate Party B to access and study documents, financial reports, prospectuses... to serve the process of determining the legitimate interests of investors.

It is recommended that Party B send an official document to VIMC regarding the itinerary, documents and working time for discussion and agreement between the parties, to ensure that the operations of VIMC/Quy Nhon Port Joint Stock Company are not affected.

It is worth mentioning that, after taking over the management and operation of Quy Nhon Port Joint Stock Company, with the desire to fulfill the financial obligations between the parties, VIMC sent 19 documents to Hop Thanh Investment and Mineral Joint Stock Company, urging, requesting to organize meetings, sending calculation plans and proposing legal values of investors during the operation and management phase of Quy Nhon Port, the most recent being Document No. 2072/HHVN-DT dated December 12, 2024.

However, since 2022, Hop Thanh Investment and Minerals Joint Stock Company/DQ Law Firm has not taken any further action.

VIMC has also sent many documents to the Ministry of Transport and the Government Inspectorate, requesting support and guidance to promptly and thoroughly handle this content.

However, to date, VIMC has not yet received a plan from Hop Thanh Investment and Mineral Joint Stock Company, nor has it received instructions from relevant ministries and branches. Therefore, the determination of the value of the legal benefits of investors has not yet had any results, as a simultaneous debt in the implementation of Inspection Conclusion No. 1566.

“To promptly resolve the case and complete the implementation of the recommendations according to the Inspection Conclusion, VIMC requests the Ministry of Construction to consider and chair a meeting between the parties to remove difficulties and guide VIMC and Hop Thanh Investment and Mineral Joint Stock Company in accordance with Article 4 of the Transfer Contract,” the VIMC representative proposed.

Nearly 6 years after the Government Inspectorate issued Conclusion No. 1566/KL-TTCP on the equitization of Quy Nhon Port Joint Stock Company, Vietnam National Shipping Lines has not been able to completely resolve issues related to the recovery of 75.01% of Quy Nhon Port shares to state ownership.

Comment (0)