Many organizations and individuals are actively looking for troubled securities companies to buy, sell and merge (M&A), and at the same time change their names and leadership, with the goal of expanding the ecosystem.
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Change of owner when business is difficult
The fact that the State Securities Commission (SSC) has stopped granting licenses to open new securities companies in the past 5 years has made existing securities companies, even those with poor performance, attractive targets for M&A corporations/individuals to participate in the market.
In 2024, the market will continue to witness a series of small and medium-sized securities companies changing ownership and brand identity when there is a new group of shareholders. For example, Royal International Securities Joint Stock Company changed its name to UP Securities Joint Stock Company, at the same time changing its brand identity and converting to an online trading platform.
In fact, before the change of name and brand identity, this unit had a major shareholder change, when it dismissed a series of members of the Board of Directors including Mr. Le Thanh (Chairman of the Board of Directors), Mr. Ho Ngoc Toan, Ms. Tran Thi Thu Huong and Mr. Le Thanh Ha. On the contrary, it appointed Mr. Cao Tan Thanh as Chairman of the Board of Directors; Mr. Vu Viet Bao, Mr. Le Tuan and Ms. Vu Thi Hong Giang as members of the Board of Directors.
It is known that before the new group of shareholders restructured, as of June 30, 2024, UP Securities had a charter capital of VND 300 billion and total assets of VND 324.9 billion, belonging to the group with low charter capital.
The 16th Vietnam M&A Forum 2024 - a prestigious annual event on mergers and acquisitions and investment connections organized by Dau Tu Newspaper under the direction and sponsorship of the Ministry of Planning and Investment, will be held at JW Marriott Saigon Hotel (HCMC) on Wednesday, November 27, 2024.
With the theme “Bustling Deals/A Blossoming Market”, the Vietnam M&A Forum 2024 will discuss in depth the emerging M&A opportunities in potential sectors such as real estate, retail, technology, renewable energy, financial services and logistics.
The event will have the following main activities:
– Main workshop with leading Vietnamese and international speakers.
– Honoring outstanding M&A deals and consultants in the period 2023 – 2024.
– Release of Special Edition M&A Market Panorama 2024 (bilingual Vietnamese - English).
Similarly, recently, Saigonbank Berjaya Securities Joint Stock Company also had fluctuations when the founding shareholders of Inter-Pacific Securities divested. Ms. Nguyen Thi Huong Giang, Chairwoman of the Board of Directors, bought an additional 4 million shares.
The composition of the Board of Directors also changed when Saigonbank Berjaya dismissed Mr. Pham Hoai Nam and Mr. Kuok Wee Kiat and elected Mr. Cao Minh Vinh and Ms. Nguyen Thu Phuong. The change in shareholders coincided with the period when the Company increased its charter capital from VND300 billion to VND350 billion.
Saigonbank Berjaya is an inefficient unit. As of September 30, 2024, the Company had an accumulated loss of VND 260.87 billion, equal to 74.5% of total charter capital.
A similar deal took place at Hai Phong Securities Corporation (Haseco, code HAC), when two new shareholders, Mr. Tran Anh Duc and Mr. Vu Hoang Viet, invested hundreds of billions of VND, holding 19.94% and 24.87% of charter capital, respectively. Before the new group of shareholders joined, as of September 30, 2024, Haseco had an accumulated loss of 32.3 billion VND, equivalent to 11.07% of charter capital.
With Viet Tin Securities Joint Stock Company (VTSS), after TIN Global Pte. Ltd acquired 49% of charter capital, this unit also changed its name to VTG Securities Joint Stock Company and moved its headquarters from Hanoi to Ho Chi Minh City.
Before the new group of shareholders, as of September 30, 2024, VTG Securities had a charter capital of VND 138 billion, total assets of VND 112.9 billion and an accumulated loss of VND 25.3 billion, equal to 18.3% of charter capital.
Thus, it can be seen that the common point of the group of securities companies with recent personnel changes and restructuring is that they all have small charter capital and loss-making business.
Raise the bar
In the past, there was no shortage of small securities companies that changed ownership, then large shareholders contributed more capital, helping these companies to improve.
For example, at DSC Securities Joint Stock Company (code DSC), in 2020, Vietnam Equity Joint Stock Company transferred its ownership from 60% to 0% of charter capital. On the contrary, DSC Securities has other individual shareholders, including Mr. Ta Van Manh (owning nearly 1.5 million shares, equivalent to 25% of charter capital) and Mr. Nguyen Duc Anh (owning 25% of charter capital).
After many fluctuations, by the end of 2023, DSC Securities still has 2 major shareholders: Mr. Nguyen Duc Anh (owning 35.6% of charter capital) and NTP Investment Joint Stock Company (owning 34.2% of charter capital). The remaining 30.2% of charter capital belongs to small shareholders.
After a new group of shareholders joined DSC Securities, this unit moved its headquarters from Da Nang to Hanoi. Thanh Cong Group (TC Group) said that DSC Securities joined the Group's ecosystem from the end of 2021.
With the support of new shareholders, DSC Securities increased its capital from VND 60 billion to VND 1,000 billion, continued to increase its capital in 2023 to VND 2,048 billion and received additional loans from the Prosperity and Development Joint Stock Commercial Bank (a member of TC Group).
Mr. Lam Van Van, representative of ECI Capital Investment Fund, commented that the reason why organizations/individuals promote M&A of small-scale, inefficient securities companies may come from many purposes. In particular, acquiring small companies will be easier when existing shareholders no longer want to develop the company, on the contrary, the buyer can officially own the securities company in the context of the new establishment not being licensed and can support the existing ecosystem in raising capital in the future.
Source: https://baodautu.vn/cong-ty-chung-khoan-nho-va-vua-muc-tieu-hap-dan-trong-ma-d230209.html
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