Some shareholders and representatives of foreign investment funds disagree with KIDO's divestment from its subsidiary, indirectly leading to disputes over the Celano and Merino ice cream brands.
The origin of the dispute over the Celano and Merino ice cream brands
On the morning of January 24, KIDO Group Joint Stock Company (KIDO; HoSE: KDC) held an extraordinary general meeting of shareholders in 2024.
At the congress, in addition to a preliminary report on the business performance of the past year, KIDO asked for shareholders' opinions on the transaction of selling shares at KIDO Frozen Food Joint Stock Company (KDF) and the issue of protecting the Celano and Merino ice cream brands.
Regarding the sale of shares in KDF, in 2023, KIDO sold 24.03%, reducing its ownership ratio from 73% to 49%. This deal brought KIDO VND 1,069 billion and KDF from a subsidiary to an affiliated company of the group.
By September 2024, Nutifood said it had completed the acquisition of 51% of shares, becoming the controlling unit of KDF.
Regarding KDF, this business was formed in 2003 after KIDO acquired the Wall's ice cream brand. In the period 2004-2005, KDF successively launched two ice cream brands Celano and Merino. These were KDF's two main products until the business was sold.
In June 2022, KDF signed a contract to transfer the Celano ice cream brand and more than 30 other brands owned by this enterprise to KIDO. At the end of 2023, KDF continued to transfer the Merino ice cream brand to KIDO.
However, recently, KDF has been promoting the Celano ice cream brand without the consent of KIDO. This includes advertising Celano ice cream in music and entertainment programs such as “Anh Trai Say Hi” and “2 Ngay 1 Dem” produced by Dat Viet Media Joint Stock Company.
Therefore, KIDO has filed a lawsuit against KDF. Recently, the Ho Chi Minh City People's Court issued a decision to apply temporary emergency measures, prohibiting KDF and Dat Viet Media from advertising, promoting, and introducing the Celano ice cream brand.
Shareholders oppose trillion-dollar deal
Returning to the sale of more than 24% of KDF shares, KIDO's board of supervisors said that this was an important transaction and KDF was using brands owned by the group, so it needed shareholders to review and give their opinions.
Speaking to shareholders, Mr. Tran Kim Thanh - Chairman of KIDO Board of Directors said that in M&A deals, there is a difference between buying a business and buying a brand. When KDF changed from a subsidiary to an affiliated company of the group, there was ambiguity in the ownership of the brands.
At the meeting, a representative of Star Pacifica Investment Fund (Singapore), which owns 7.1% of KIDO shares, with a market value equivalent to VND1,120 billion, said that the decision to sell more than 24% of KDF shares was under the authority of KIDO's Board of Directors. However, this person did not agree with the transaction because it has affected the interests of many shareholders, including Star Pacifica.
“I believe that KIDO will operate the ice cream industry more effectively than any other company to bring profits to shareholders. I propose that the Board of Directors come up with a plan to handle this transaction to ensure the interests of shareholders,” said a representative of the Star Pacifica investment fund.
Sharing the same view, a representative of Vina QSR Limited investment fund, which owns 2.6 million KIDO shares, said that before investing in the group, the fund believed in the way KIDO operates its product lines, in which the two ice cream brands Celano and Merino lead the market.
Regarding KIDO selling KDF shares without consulting shareholders, a representative of Vina QSR Limited said that the interests of the fund and shareholders are being affected. This person disagreed with the transaction and requested that the KIDO Board of Directors and shareholders vote publicly on this issue.
At the voting session, more than 89% of shareholders attending the meeting did not approve the transaction to sell more than 24% of KDF shares. At the same time, shareholders approved to retain ownership at KDF to protect the brand value, the right to use or authorize third parties and subsidiaries to use.
In addition, KIDO shareholders also approved the authorization of the Board of Directors and General Director to decide on specific terms and sign and execute related transactions, contracts, agreements, and documents related to the Celano and Merino brand transactions.
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Source: https://vietnamnet.vn/co-dong-kido-phan-doi-thuong-vu-ban-co-phan-cong-ty-kem-thu-nghin-ty-2366294.html
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