March 12, 2012
In order to pay debts to fish farmers and banks, the Vietnamese Binh An Seafood Joint Stock Co. (Bianfishco) will offer its processing plant and residential projects for sale.
The company will spend three months fulfilling debt payments to the farming households that it owes little, while larger creditors will be paid back in more than three months, with bank interests sufficiently included, said Bianfishco General Director Tran Van Chi at a press briefing on Wednesday (Mar 7) in Mekong Delta's Can Tho City.
In case the aforementioned assets are not enough to pay debts to farmers and banks, Tri committed to sell his own house.
Tri informed that an 80% stake of the seafood firm has been transferred to a foreign partner at the trading value of US$120 million. However, the partner has recently pushed down the value to US$80 million.
Bianfishco currently owes fish farmers some VND262 billion (US$12.42 million) and banks VND1.2 trillion (US$57.7 million).
Besides the global economic recession that has sent the seafood market into tailspin, Tri ascribed the current debt situation to his firm's investment in the troubled property, financial and stock market. As a result, Bianfishco is unable to rotate capital to pay farmers as well as banks.
In addition, due to the shortage of input materials, Bianfishco has laid off a number of workers. The company now has 2,000 labourers working at its seafood processing plant and in case the plant is sold, Bianfishco will fulfil its duties to employees.
Bianfishco has previously sent a dispatch to the central bank asking for a loan of VND350 billion (US$16.8 million) to pay debts but was turned down, leading to the company's decision to sell its factory and residential projects.
Bianfishco was founded in the Can Tho city-based Tra Noc II Industrial Park in 2005 and started operation a year later. After three years, the seafood company's revenue surged from VND100 billion (US$4.8 million) in 2006 to VND1 trillion (US$48 million) in 2009.
Apart from developing the processing plant, Bianfishco also invested in seafood farming to create competitive advantages. In July 2010, the company established Binh An Tra Fish Research Institute.