|Trường Hải Auto Corporation is seeking shareholders’ approval to increase capital from the current VNĐ4.15 trillion to VNĐ16.58 trillion (US$730.4 million). — Photo youtube.com|Viet Nam News
HÀ NỘI – Trường Hải Auto Corporation is seeking shareholders’ approval for a massive capital hike, which is expected to increase capital from the current VNĐ4.15 trillion to VNĐ16.58 trillion (US$730.4 million).
According to its document sent to shareholders, Trường Hải Auto is planning to issue over 1.24 billion bonus shares at the face value of VNĐ10,000 per share, worth a total of VNĐ12.44 trillion.
Existing shareholders will be given bonus shares at the rate of 300 per cent (one share holding will receive three new shares). The payout is scheduled in the last quarter after getting the nod of the State Securities Commission.
In addition, the auto company decided to pay additional 20 per cent cash dividend for 2016, raising the total dividend payout for 2016 to 50 per cent (30 per cent was previously paid in May this year).
The two payouts are funded from the capital surplus of nearly VNĐ3 trillion and undistributed profits until June 30, 2017 that reached VNĐ16.3 trillion.
The company said the capital hike aims to supplement funds for its business operation and investment for subsidiaries until 2018. However, the bonus share issue only increases the quantity of charter capital and outstanding shares on the market, while total equity capital does not change.
Trường Hải Auto is struggling due to declining car prices and fierce competition. In the first half of this year, the company’s auto sales recorded negative growth for the first time in many years.
Its profits dropped sharply to over VNĐ2.6 trillion in the six months, down from VNĐ3.7 trillion in the same period of last year. – VNS