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Soon after a Singaporean fund divested its entire stock in Vietnam’s top taxi firm Vinasun, a domestic securities firm stepped in to fill the gap.
The Ho Chi Minh Securities Corporation (HSC), a professional securities brokerage and equities firm in Vietnam, has announced that it bought 7.2 million shares of Vinasun on May 25, the same day that Singapore sovereign wealth fund GIC exited.
It is estimated that HSC has spent about VND104 billion ($4.5 million) to acquire 10.6 percent of Vinasun’s equity, making it the third largest shareholder of the taxi firm, behind TAEL Partners fund, which owns 18.3 percent, and Vinasun CEO Dang Phuoc Thanh, who owns over 35 percent.
On May 25, GIC had negotiated the sale of 5.4 million shares, or around 8 percent of its stake in Vinasun, for around VND80 billion ($3.5 million), less than half the price it paid four years ago.
The divestment followed lackluster performance by the taxi company, which had seen its share value plunge. The company has blamed its woes on “unfair competition” from foreign ride-hailing service companies.
Ride-hailing services Grab and Uber arrived in Vietnam in 2014, launching both car and motorbike taxi services. The two services have been running on a trial basis since early 2016, cutting deep into the earnings of traditional taxi drivers.
Many taxi firms have accused Grab and Uber of unfair competition, saying their businesses have suffered and thousands of drivers have had to quit. Currently, Vietnam is investigating Grab’s acquisition of Uber, saying there are signs of antitrust law infringement in the deal.
Vinasun has targeted revenues of VND2.16 trillion ($94.9 million) and after-tax profits of VND95 billion ($4.18 million) this year, 50 percent less than in 2017 and the lowest target in nine years.
By the end of 2017, Vinasun had whittled down its staff to just 7,117, a decrease of 10,000 people from the beginning of the year. In the first three months this year, it lost another 120 employees.
