After cooking oil and confectionery, tycoon Tran Kim Thanh 'jumps' into seafood

Kido Group Corporation (HoSE: KDC), chaired by Mr. Tran Kim Thanh, has just announced that the corporation has completed transactions in stages to hold 58.05% of shares of Hung Vuong Corporation (HVG), as of August 22, turning the enterprise of Chairman Duong Ngoc Minh into a subsidiary.

Thus, the one-time "king of pangasius", Hung Vuong Seafood (HVG), officially belongs to another ambitious tycoon.

Kido is known as the number 1 giant in the confectionery industry, with the Kinh Do mooncake brand. But in 2014, the entire Kido confectionery production division was sold to the American giant Mondelēz International, earning 8,000 billion VND.

After that historic deal, Kinh Do changed its name to Kido Group and continuously restructured, focusing on the vegetable oil sector with a series of M&A deals, notably Tuong An Cooking Oil. Recently, Kido has delved into the essential goods sector, especially the spices and sauces sector.

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HVG officially became a subsidiary of Kido.

In the third quarter of 2023, Kido recorded an estimated investment of more than VND 1,000 billion in Tho Phat International Joint Stock Company (Tho Phat) and held 68% of the shares of this famous dumpling manufacturer. This is the next piece in the strategy to re-expand the bakery industry, aiming to make Kido the leading food group in Vietnam.

Since 2020, Mr. Tran Kim Thanh's KDC has returned to the confectionery market with the Kingdom mooncake brand after more than 5 years of absence.

To date, Kido has many subsidiaries and affiliates. Kido owns 87.3% of shares of Vietnam Vegetable Oil Industry Corporation - Vocarimex (VOC); nearly 76% of shares of Golden Hope Nha Be Cooking Oil Company; about 62% of Tuong An Vegetable Oil Joint Stock Company (TAC); indirectly through Vocarimex, it owns more than 51% of shares of Vegetable Oil Packaging Joint Stock Company (VPK); 65% of Kido Frozen Food...

Kido also owns 40% of LG Vina Cosmetics Co., Ltd. and 34% of Phong Thinh Investment and Development JSC.

At the 2024 Annual General Meeting of Shareholders on June 19, Kido set a target of increasing revenue by 50% to VND13 trillion this year, with pre-tax profit increasing 2.5 times to VND800 billion. Mr. Tran Kim Thanh's company continues to develop and expand the essential food industry; at the same time, focusing on developing new products/industries and expanding the distribution chain nationwide and aiming to expand to foreign markets.

Kido's main businesses are: cooking oil, spices (fish sauce, seasoning powder, soy sauce, spice powder...), cakes (fresh cakes, moon cakes), dumplings, ice cream... Kido plans to M&A Hung Vuong Plaza and Van Hanh Mall. In the third quarter of 2024, this group will acquire Hung Vuong Plaza with a 77% ownership ratio.

'Pangasius King's' billion-dollar dream shattered

In contrast to Kido's strong breakthrough, Mr. Duong Ngoc Minh's Hung Vuong Seafood (HVG) has been in recession and debt for many years due to being involved in many industries and carrying out many M&A deals.

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Mr. Duong Ngoc Minh. Photo: TP

Hung Vuong Seafood became a joint stock company in early 2007, and listed its shares on HoSE in 2009. Mr. Minh's company owns 7 pangasius processing factories for export with a closed production model leading in Vietnam in terms of scale of operation, export turnover and product quality. HVG's factories are qualified to export to 27 EU countries and expand exports to the US, Eastern Europe, China, etc.

Since 2013, HVG's revenue has exceeded 10 trillion VND (nearly 11,180 billion VND) - while Mr. Tran Kim Thanh's KDC at that time had a revenue of 4,670 billion VND.

This was also the time when Mr. Duong Ngoc Minh aimed for a revenue target of billions of USD, which was very rare at that time. In the following years, HVG's revenue continued to increase, reaching more than 15 trillion VND in 2014 and more than 18 trillion VND in 2016.

However, the dream of HVG's boss did not come true. HVG went downhill due to too much debt and ineffective business.

From a large enterprise in the seafood industry, after a period of prosperity, HVG fell into losses in 2016, 2017 and suffered heavy losses in 2019. By the end of 2019, the accumulated loss was more than 1,700 billion VND.

In August 2020, Hung Vuong Seafood was forced to delist from HoSE due to serious violations of information disclosure obligations. Immediately after that, HVG was transferred to Upcom at VND5,400/share and then suspended from trading from the end of 2023 at a price of only VND1,400/share.

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HVG is heavily indebted and collapsed.

"Pangasius King" Hung Vuong was once rescued by billionaire Tran Ba ​​Duong but failed and then had to consider selling a series of assets to pay off debts. Mr. Duong Ngoc Minh's HVG had to gradually sell well-functioning machines, such as Viet Thang Animal Feed JSC (VTF)...

HVG's difficulties probably come from expanding too quickly and shifting to multi-industry. From a scale of 120 billion VND in 2007, by the end of 2016, HVG had 27 subsidiaries and associates, with a total capital of more than 16.6 trillion VND, of which short-term loans were nearly 7,650 billion VND and long-term loans were nearly 1,060 billion VND.

The loan amount was too large while the main business was not favorable, causing HVG to face difficulties and not be able to repay the debt. The profit level was very low and could not cover the interest payments. HVG was refused a debt extension by banks and fell into difficulties, having to gradually sell its subsidiaries and affiliates.

HVG's prospects became less bleak in early 2020, when billionaire Tran Ba ​​Duong's Thaco came to the rescue.

The appearance of a major shareholder - Thaco Group - has increased expectations for the recovery of Hung Vuong Seafood. However, Mr. Duong Ngoc Minh's business has not been able to recover, especially during the period when seafood exports faced difficulties due to the Covid-19 pandemic.

Just over a year after signing the strategic cooperation, billionaire Tran Ba ​​Duong's group sold HVG shares and withdrew from the rescue of the tra fish giant.

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