Pomina Steel has agreed to sell nearly 70.2 million shares, a 20% stake, to Japan’s Nansei steel.
The company will sell at VND10,000 ($0.42) per share, 35% higher than its market price. The deal, to be conducted in August this year and September next year, is estimated to fetch Pomina nearly VND702 billion.
Nansei Steel is based in Japan’s Chiba. It first established a Vietnam entity around six months ago. Pomina’s announcement has seen its shares shoot up from VND6,900 to around VND7,390.
Currently Vietnam Steel Corp is the biggest shareholder in Pomina with a 53.3% stake.
Pomina, based in Ho Chi Minh City, has been facing financial difficulties. It posted a loss of VND1.1 trillion last year and another VND186 billion in the first six months of this year.
Its CEO Do Tien Si said that the frozen property market had caused steel demand to plunge, and the high costs of its new blast furnace, were the main reasons for the losses .
The company expects a loss of VND150 billion this year.