Vietnam’s top jewelry firm keeps defunct joint venture on its books

By Phuong Dong May 3, 2019 | 02:28 am PT

SJC has not dissolved a joint venture with two foreign firms which was established in 1993. Photo courtesy o SJC

Vietnam’s top jewelry company SJC has not dissolved a joint venture with foreign firms two decades after it became defunct.

SJC’s recently released 2018 financial report shows that magnetic tape company Sai Gon Saindes remains one of its five affiliates although the Ministry of Industry and Trade had agreed for it to be dissolved in 1997.

Sai Gon Saindes was established in 1993 as a joint venture between SJC, Hong Kong’s Indesen Co. Ltd and Australia’s Asia Investment and Trading Co. SJC owned a 45 percent stake in the joint venture which had a chartered capital of $10.5 million.

Due to internal conflicts, the three firms agreed to dissolve the company and signed a memorandum to split the assets. However, the then chairman of SJC said in 2000 that the document did not have legal value and refused to implement it.

The foreign companies have taken the issue to court many times, but a final verdict has not been issued yet.

SJC accounted for 90 percent of total gold bar supply in Vietnam last year. Its revenue fell 9 percent from 2017 to VND20.8 trillion ($890.3 million) in 2018, while its after-tax profit fell almost three times from 2017 to less than VND28 billion ($1.2 million).