Bibica becomes official PAN Food subsidiary

PAN Food Manufacturing JSC (PAN Food) successfully acquired more than 50 per cent of Bibica Corporation (Bibica)’s stakes, overtaking Lotte Confectionery Co., Ltd. (Lotte) as the biggest shareholder and turning Bibica into a subsidiary.

Bibica is now a subsidiary of PAN Food

On August 30, 2017, PAN Food announced the successful purchase of 977,647 Bibica stocks, which raised its total holding in Bibica to 7,720,577 shares, an equivalent of 50.07 per cent. By holding more than 50 per cent, PAN Food has become the biggest shareholder in Bibica, overtaking Lotte, which holds 44.03 per cent. Therefore, Bibica has quietly become a subsidiary of PAN Food.

However, as of the middle of June 2017, Lotte still had two representatives on Bibica’s board of directors, while PAN Food had only one, Nguyen Khac Hai. Currently, even though PAN Food holds a 51 per cent stake in Bibica, it cannot add another representative to the board of directors just yet, as they will have to wait until a Lotte representative or an independent member ends their term.

The reason is that in accordance with the Law on Enterprises, PAN Food should hold 65 per cent of Bibica’s stakes to call a shareholders’ meeting and call for the election of a new member.

PAN Food said that it will team up with Bibica to pool strengths and enhance human resources in the food industry, improve corporate governance, mobilise capital, raise investment into manufacturing facilities, and expand the distribution system.

The cooperation between PAN Food and Bibica started in 2015, when Bibica administered significant changes in investment orientation and product portfolio, as well as the increasing growth rate. Thanks to this partnership, Bibica has utilised many of PAN Food’s advantages to enhance its financial management system, operation management, and risk management.

In 2016, Bibica generated a net revenue of more than VND1.2 trillion ($52.8 million), earned an after-tax profit of more than VND81 billion ($3.6 million), and paid its shareholders a dividend of 12 per cent in cash.

In 2017, Bibica targeted to generate a net revenue of more than VND1.4 trillion ($61.6 million), earn a pre-tax profit of VND104.3 billion ($4.6 million) and after-tax profit of VND86.6 billion ($3.8 million). The expected dividend paid for shareholders in 2017 was 12-18 per cent.

Also in 2017, Bibica has invested in the first high-end soft candy project in Vietnam. This candy product has a high level of condensed milk content (20 per cent), while similar products in the market have 4-8 per cent only. Moreover, Bibica also has a cookies project and a project on upgrading its bread production lines. The total investment for these projects has exceeded VND250 billion ($11 million).

PAN Food, a subsidiary of PAN Group, operates in the food processing and distribution industry, specialising in safe and nutritious food products.

Sticking to this strategy, from 2014 till now, PAN Food has implemented numerous mergers and acquisitions (M&A) deals with the aim of investing, owning, and merging with leading enterprises in the food processing industry, such as Bibica, Lafooco, and Aquatex Ben Tre.

By Trang Vu

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