Aboitiz’s Pilmico expands footprint in Vietnam
ABOITIZ Equity Ventures, Inc. (AEV) is expanding its footprint in Vietnam as its food unit takes over Pilmico Vietnam Trading Co. Ltd. for 888 million Vietnamese dong (around $40,000).
In a disclosure to the Philippine Stock Exchange on Wednesday, the listed conglomerate said subsidiary Pilmico International Pte. Ltd. will acquire 100% of ownership interests in Pilmico Vietnam Trading from a certain Pham Thu Houng.
Pilmico International signed on Oct. 28 the capital assignment agreement with Pilmico Vietnam Trading, a limited liability company engaged in the wholesale of food products, beverages, agricultural and forestry raw materials, among others.
“Pilmico Vietnam Trading will be the vehicle used for the importation and distribution of Pilmico products in the Vietnam market,” AEV noted in the disclosure.
In 2014, Pilmico International also acquired a 70% equity interest in Vinh Hoan 1 Feed JSC from Vinh Hoan Corp. under a $28-million deal that provided for the purchase of the remaining 30% stake in the Vietnamese aqua feed producer within the next five years.
“Pilmico expects to expand its market in the ASEAN (Association of Southeast Asian Nations) region,” AEV said, following the acquisition of Pilmico Vietnam Trading.
Aside from Pilmico International, AEV engages in the food business through Pilmico Foods Corp. and Pilmico Animal Nutrition Corp. The three subsidiaries cumulatively contributed P1.4 billion in income during the first nine months, a 1% decline from last year mainly due to lower selling prices.
AEV continues to source bulk of its earnings from the power business, which accounted for 63% or P15.1 billion of the group’s P17.1-billion year-to-date net income. Contributions from banking and financial services stood at 22%, food at 7%, infrastructure at 7% and real estate at 1%.
The Abotiz family’s holding company is counting on its food and power businesses, among others, for international expansion. The latest acquisition will particularly widen its distribution network in Southeast Asia.
Pilmico International’s takeover of Pilmico Vietnam Trading remains subject to approval by the Ministry of Industry and Trade of Vietnam. The AEV subsidiary will settle the transaction based on the capital contribution made by Mr. Houng.
Shares in AEV closed P2.20 or 2.82% lower at P75.80 apiece amid a general downturn in the local market and across the region.
Originally posted: Business World Online