Auto firm Thaco to buy land from agriculture giant

By Phuong Dong   April 25, 2019 | 02:16 am PT
Auto firm Thaco to buy land from agriculture giant
A farm of HAGL Agrico. Photo courtesy of HAGL Agrico
Vietnam’s leading auto firm Truong Hai Auto Corporation (Thaco) has inked a deal to buy land from rubber and fruit producer Agrico.

Tran Ba Duong, chairman of Thaco, said Wednesday that his company will buy 2,000 hectares of land from Hoang Anh Gia Lai (HAGL) Agrico worth VND6.2 trillion ($265.9 million). Thaco has put down a 30 percent deposit.

He said that Thaco, a manufacturer of cars and trucks, has established a subsidiary with a charter capital of VND2.1 trillion ($90 million) to invest in agriculture and animal husbandry after signing a memorandum of partnership with HAGL Agrico last August. HAGL Agrico is a subsidiary of the HAGL Group.

Thaco’s subsidiary and Agrico will grow fruits in Vietnam, Laos and Cambodia and export to other countries.

This year, the subsidiary plans to export 15,000 containers, or 300,000 tons, of fresh fruits and fruit products. It also plans to grow fruit on another 11,500 hectares.

Thaco last week registered with the Ho Chi Minh Stock Exchange (HOSE) to buy a 7.86 percent stake in Agrico for VND1.05 trillion ($43.4 million).

Last August, Thaco paid VND3.8 trillion ($168.8 million) to buy one-year convertible bonds issued by Agrico, equivalent to over 221 million shares when converted, which will give the carmaker a 35 percent stake.

Thaco chairman Duong also said Wednesday that his company has acquired a 65 percent stake in HAGL Land, another subsidiary of HAGL Group. HAGL Land is the investor of a mall, office and hotel complex in Myanmar.

Thaco plans to increase its ownership even more in the company to make the complex a "trademark of Vietnam investment in Myanmar," he said.

HAGL Group, formerly a leading property developer in the country, had said recently that it plans to divest from its project in Myanmar.

The company has in recent years shifted its focus to agriculture. Last year, HAGL Group's revenues from real estate accounted for just 1.1 percent at VND58 billion ($2.5 million).

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