HA NOI — Confectionery producer Bibica's (BBC) general director Truong Phu Chien denied the possibility that its largest shareholder – South Korean retailer Lotte – would acquire the company.
During its recent shareholder meeting, Bibica postponed the change of the company name into Lotte-Bibica. The incomplete US$10 million factory in northern Hung Yen Province and damages from a factory fire caused Lotte to halt the change.
Many small shareholders seemed to be displeased when Lotte took control of Bibica and used its power for its own benefits. They protested assigning another South Korean to the management board.
A small shareholder said: "Lotte's holding ratio is 38 per cent, leaving it so much power to serve its own purposes." He was afraid that he would lose all the investment in the company, and that Bibica would become just a tool for parent company Lotte.
"However, Lotte would hardly be able to acquire us," Chien told local press after the meeting.
If the company wanted to change its name, it must revise the operation charter, which requires the approval of at least 75 per cent of attended shareholders. Meanwhile, the Korean partner holds only a 38 per cent stake.
Based on legal regulations, if Lotte's holding exceeds 51 per cent, it can reach its ambition. With the current ownership, Lotte will need to make it public if it wants to purchase more BBC shares.
"Lotte is a reputed corporation and complies with the local laws, so I don't think it will secretly do something dubious just to reach its goal," Chien said.
In addition, he held firm that if shareholders with over 25 per cent of the voting shares persisted to retain Bibica brand, it could be achieved.
However, the Korean shareholder might not easily give up, as its intention to acquire the second largest Vietnamese confectionery producer sprouted in 2007 when Lotte and Bibica signed a co-operative contract. — VNS