HCM CITY — The Kinh Do food and beverage corporation, listed at the HCM City Stock Exchange as KDC, plans to issue 20 million global depositary receipts (GDR) this year.

Its shareholder annual meeting last Saturday approved the new issue via private placement and authorised executive board to choose the suitable time and method to gain the best benefit.

CEO Tran Le Nguyen said, with consultancy from Sacombank Securities (SBS), Deutsche Bank was chosen as the underwriter.

He will apply for private placement to the State Securities Commission and expect to collect the money by July.

A depositary receipt is a negotiable certificate that represents a company's publicly traded debt or equity, which facilitates trading outside the country where the company operates.

The sale is hoped to help KDC increase its chartered capital by VND200 billion (US$9.5 million) to almost VND1.4 trillion ($66.7 million), plus a larger amount of surplus.

The receipt will then be listed at the London Stock Exchange, following the step of Hoang Anh Gia Lai (HAG), who pioneered the GDR issuance and last month its GDR were listed on the LSE board as the first by a Vietnamese firm.

KDC will try to pay this year's dividends at 24 per cent, just as 2010, despite the challenging general economic situation.

Shareholders approved that KDC should focus on its core business and reduce financial investment.

It targets a food and beverage turnover (not calculating the property business in the turnover as this operation may not bring in fruitful result this year) at VND4.2 trillion (US$200 million) this year, up from last year's VND3.317 trillion.

Gross profit is expected to reach VND500 billion from 2010's 420 billion.

Source: Vietnamnews.com.vn