Key Highlights
- F&N plans to acquire up to 4.6% additional shares in Vinamilk, potentially raising its effective interest from 20.39% to 24.99%.
- Vinamilk is Asia’s leading dairy company, boasting strong brand recognition, extensive distribution, and resilient financial performance.
- The acquisition will be earnings-accretive and funded through a mix of internal resources and borrowings.
- Shares will be purchased from Platinum Victory Pte Ltd, a subsidiary of Jardine Cycle & Carriage Limited.
- F&N has no intention to trigger a public tender offer under Vietnam law by exceeding relevant thresholds.
- The acquisition is subject to certain completion conditions, with no certainty it will be completed as announced.
Article Details for Investors
Fraser and Neave, Limited (F&N), a leading Singapore-based food and beverage group, has announced its intention to deepen its strategic partnership with Vietnam Dairy Products Joint Stock Company (Vinamilk) by acquiring up to 4.6% additional shares. This move is set to boost F&N’s effective ownership in Vinamilk from 20.39% to 24.99%, signaling a robust vote of confidence in both Vinamilk’s market position and the growth potential of Vietnam’s dynamic dairy sector.
Vinamilk stands as one of Asia’s foremost dairy companies, recognized for its powerful brand portfolio, far-reaching distribution, and resilient financial results. The company continues to achieve strong growth domestically and in export markets, making it an attractive partner for F&N’s long-term Southeast Asia dairy ambitions.
Strategic Rationale and Potential Impact
The acquisition aligns with F&N’s strategy to consolidate its position in the regional dairy market. According to F&N CEO Rahul Colaco, the investment is a reflection of the group’s disciplined focus on long-term value creation, partnership, and operational synergies across dairy farming, manufacturing, innovation, and distribution.
The deal, involving up to 96,094,631 shares (approximately 4.6% of Vinamilk’s issued shares), will be executed via purchase from Platinum Victory Pte Ltd, a Jardine Cycle & Carriage subsidiary. The transaction is structured to be earnings-accretive, potentially enhancing F&N’s profitability and shareholder value.
Important Shareholder Information
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Price Sensitivity: The proposed increase in stake is likely to be viewed positively by the market, given Vinamilk’s strong fundamentals and F&N’s confidence in its future. Investors should monitor developments closely, as the deal could influence both companies’ share prices.
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Funding and Financial Impact: The acquisition will be funded through a mix of internal resources and borrowings, suggesting F&N is leveraging its balance sheet to support growth.
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No Public Tender Offer: F&N does not intend to acquire additional shares in a manner that would trigger a mandatory public tender offer in Vietnam, limiting further dilution or regulatory complications for existing Vinamilk shareholders.
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Completion Risks: The transaction is subject to certain conditions and there is no guarantee of completion at this stage. Shareholders should exercise caution and stay updated on subsequent announcements.
Contact Information
For further clarification and investor queries, shareholders may contact:
Ms Jennifer Yu
Director, Investor Relations
DID: 6318 9231
Email: [email protected]
Conclusion
This proposed acquisition marks a significant strategic step for F&N in the Southeast Asian dairy sector and could be a substantial driver for future growth and value creation. The market should closely watch for updates on the deal’s completion and any subsequent impacts on F&N’s financials and share price.
Disclaimer: The information provided above is based on the latest company announcement and is for informational purposes only. The proposed acquisition is subject to completion conditions and may not proceed as described. Investors are advised to exercise caution, seek professional advice, and monitor official announcements before making any investment decisions.
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