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FPT to cut its stake in retail unit to below 50%

20:44 | 03/08/2017

Information technology group FPT Corporation FPT has announced it will reduce its ownership in its retail arm FPT Technology Production Distribution and Retail to below 50 percent

fpt to cut its stake in retail unit to below 50

The group said in its management board’s resolution issued recently that the pestment will be carried in 2017 and pided into two stages.

In the first stage, FPT will sell 30% to institutional investors to reduce its ownership to 55% from the current level of 85%.

Secondly, FPT will sell a maximum of 10% of its remaining stake in the retail and distribution arm to other investors via an initial public offering (IPO).

According to the Nikkei Asian Review, the sales of the distribution and retail arm could bring about VND2.3-2.7 trillion (US$103-121 million) to the firm. The sale income could be used to improve its technological infrastructure and provide new telecommunication services.

At the group’s annual shareholder meeting held in April, the group chairman Truong Gia Binh said selling the distribution and retail arm was a must so FPT could become a pure ICT group with rapid growth.

HCM City Securities Corporation (HSC) said in a report that the deal could be finalised in the third quarter of this year.

According to HSC, the IPO price has not been determined as FPT did not want its shares to be owned by a single investor, however, it could be lower than the share price of Mobile World Corporation.

HSC also said that FPT Retail could trade on the HCM Stock Exchange (HOSE) in 2018.

Shares of FPT, listed on the HOSE under code FPT, closed on August 2 up 0.8% at VND49,400 per share. Shares of Mobile World Corp on the same exchange ended at VND99,500 per share.

FPT also plans to increase charter capital for FPT Software LLC to VND1.3 trillion from the current VND1 trillion, marking the group’s efforts to switch its core business from retail to technology and telecommunication.

The group also announced it will make a 10% cash advance payment for 2017 pidend payout, meaning shareholders will receive VND1,000 for every share.

The group will finalise the list of beneficial shareholders on August 18 and payments will be made on August 31.

FPT in the first six months of 2017 recorded a post-tax profit of VND1.21 trillion, a yearly increase of 12%.

Source: VNA