CII adjusts plan to mobilize additional 1,977.8 billion VND

CII plans to issue an additional VND1,977.8 billion in convertible bonds

On December 25, 2023, Ho Chi Minh City Infrastructure Investment Joint Stock Company (Code CII) will finalize the list of extraordinary shareholders' meeting. In which, the company is expected to submit to shareholders an adjustment to the plan to issue convertible bonds package 2, which was approved by the shareholders' meeting in May 2023.

Specifically, this is a convertible bond package with a face value of VND 1,977.8 billion, without collateral and without warrants. The convertible bonds are issued to existing shareholders at a ratio of 20:1, equivalent to shareholders owning 20 shares having the right to buy 1 new bond with a face value of VND 100,000/bond.

The company has just raised 2,840 billion bonds, adjusted the plan to raise an additional 19,778 billion dong, image 1 — CII plans to adjust its mobilization plan to VND 1,977.8 billion (Photo TL)

The bonds issued have a term of 10 years, with a fixed interest rate of 10%/year for the first 4 interest periods. For the following interest periods, the interest rate will be calculated using the average reference interest rate at Vietcombank plus 2.5%/year.

The purpose of capital for this bond issuance is to pay off CII's bond debts. Specifically, VND500 billion will be used to pay off CIIB2023009 bond debt. VND590 billion will be used to pay off CIIB2124001 bond debt. In addition, the company also plans to contribute VND1,200 billion to Ninh Thuan BOT One Member Co., Ltd. and buy corporate bonds issued by this unit.

Previously, from October 26, 2023 to December 28, 2023, Ho Chi Minh City Infrastructure Investment also issued the first batch of convertible bonds at a ratio of 10:1. The total amount mobilized was VND 2,840.2 billion. Of which, VND 1,200 billion was used to invest in bonds of Ninh Thuan BOT One Member Co., Ltd., and VND 1,640.2 billion was invested in bonds issued by Hanoi Highway Investment and Construction Joint Stock Company.

CII restructures capital sources, revenue drops 65%

The bond issuance plan is part of CII’s capital restructuring plan to reduce the debt ratio in the company’s financial leverage. Accordingly, CII plans to issue an additional VND7,000 billion in convertible bonds. The company said that if the plan is completed, CII’s debt/equity ratio will decrease from 2.2 times to 1.1 times.

During the restructuring period, CII's Q3 revenue recorded a significant decrease. Specifically, Q3 revenue reached VND761.2 billion, down 65.5% over the same period. Cost of goods sold accounted for VND466.3 billion, gross profit reached VND265.7 billion, down 19.2%.

Financial revenue in the period increased by 83.5%, reaching VND270.6 billion. On the contrary, financial expenses also increased by 15.1%, recording VND371.8 billion. Interest expenses alone accounted for VND267.9 billion. Business management expenses and sales expenses accounted for VND12.9 billion and VND68.1 billion, respectively. Profit after tax in the third quarter reached VND107.3 billion, up 9.7% over the same period.

In CII's capital structure, total liabilities tended to decrease by more than half compared to the beginning of the year, from 20,258.5 billion to only 10,022.6 billion VND. Long-term debt decreased from 9,415 billion to 7,791.1 billion VND. Owner's equity reached 8,058 billion with accumulated undistributed profit after tax reaching 2,441.5 billion VND.

The scandal of leaders divesting capital causes stock prices to fall sharply.

Also recently, CII shareholders were very interested in the case of Mr. Le Quoc Binh, the company's General Director, and his wife suddenly divesting all of their nearly 10 million shares. After the transaction, Mr. Binh and his wife's ownership ratio dropped to 0%.

Although Mr. Binh spoke up to reassure shareholders, explaining that the divestment was to get money to continue investing in CII's convertible bonds. However, during the period of Mr. Binh's divestment, CII's stock price also had unfavorable developments.

From October 10 to October 23, during the time Mr. Binh and his wife sold 10 million CII shares, the price of this code dropped from VND 18,400/share to only VND 15,600/share. In the trading session on December 5, 2023, CII had only just recovered to around VND 17,500/share.

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