Coteccons to expand foreign ownership

Coteccons Construction Corporation (Coteccons) (CTD) plans to raise its foreign ownership ratio cap from 49 per cent to 60 per cent, CTD leaders announced during its 2017 annual shareholders’ meeting held on Thursday in HCM City.

An apartment under construction built by Coteccons.-VNS Photo Doan Tung

The board of directors will select the time of implementation as well as procedures related to the expansion. CTD’s foreign ownership ratio now accounts for just 3.63 per cent and CTD’s stock is currently most preferred by foreign investors. Therefore, the expansion plan is expected to increase liquidity and attract money inflowing into CTD, said Nguyen Ba Duong, CTD Chairman of the Board of Directors.

In 2017, CTD aims at a growth of 30 per cent in revenue, amounting to VND27 trillion (US$1.18 billion). Post-tax profits are estimated to reach VND1.7 trillion.

With strong business results in 2016, CTD decided to pay a cash dividend of 50 per cent in 2016. The company will retain 60 per cent of post-tax profits to supplement the development investment fund scheduled for the investment to the value chain of the construction sector to increase the CTD’s profit and maintain its sustainable development.

Regarding corporate governance, Duong said that by the end of June next year, CTD will have officially renewed corporate governance in accordance with the law and international practices.

CTD’s total number of employees has reached over 2,000, and the firm therefore needs to reorganise its apparatus in line with international practices to meet development requirements, Duong said.

Accordingly, Coteccons will remove the old supervision board and replace it with a new internal supervision sub-commission, which has been applied this year by the Viet Nam Dairy Products Joint-Stock Company (Vinamilk). Duong was previously elected as a member of Vinamilk’s board of directors at the company’s 2017 annual shareholders’ meeting.

The company has also established internal boards of economic, investment, financial supervisory and auditing, he added.

Duong said that CTD focuses firmly on human-centred developmen and continues to boost policies that balance benefits between employees and shareholders.

The company has been implementing a shares issuance programme under the employee stock ownership plan (ESOP), he said. Recently, CTD has issued a decision to revoke ESOP shares from employees who have quit their jobs.

At the same time, the company has generated policy encouraging key staff who contributed largely to the development of the company in 2016. The incentive value offered for employees was more than VND209 billion, equivalent to the number of ESOP shares of 2.5 million shares, representing 3.36 per cent of total shares circulating in the company.

However, in order to ensure the balance of interests between staff and shareholders, the Board members agreed to adjust the number of ESOP shares to limit the dilution of shares.

Accordingly, instead of issuing 2.5 million of ESOP shares, the company would issue only half of those shares, equivalent to nearly 1.3 million shares at the price of VND40,000 per share. This amount of stock is limited in transfer for two years from the date of issuance, Duong said.

Half of the incentive share amount will be paid in cash, he added.

Source VNA

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