Feed maker sold to Hong Kong firm
However, the deal is attracting controversy for transferring the
control of a major player in the feed industry outside the region.
Vissan Ltd General Director Van Duc Muoi told the Dau tu (Vietnam
Investment Review) that Vissan was concerned about the deal, since CP
Vietnam already cornered most of the domestic market for agricultural
materials used in producing animal feed.
"The
infrastructure of Vietnam 's livestock industry is weak, and the
domestic animal feed market in particular is under the control of
foreign companies, including CP Vietnam," Muoi said.
However, CP Vietnam General Director Sooksunt Jiumjaiswang Lerg said
that the deal simply represented the transfer of capital within the
group's managment scope.
"Selling our stake to CPP Hong
Kong is to easily mobilise capital for business expansion, as the Hong
Kong-based company is listing shares on the Hong Kong stock market,"
Lerg said.
CP Vietnam previously raised extra capital by
borrowing from its Thai parent company. "However, as the demand for
investment by CP Vietnam has grown quickly, we need to be able to raise
more capital through the stock market," Lerg said.
CP
Vietnam accounts for 20 percent of the total domestic market share in
the feed industry. It also provides 5 percent of the nation's pork, 40
percent of processed chicken and 50 percent of chicken eggs. It has
planned to expand its production to other products with the aim of
establishing a new plant each year. The company is currently building a
food processing factory in Ha Noi before completing one more in the
south./.