Sotrans approves full takeover by ITL Corporation

ITL Corporation was greenlighted for a complete takeover of Sotrans

If the transaction is carried out according to plan, ITL will make a complete takeover of Sotrans. As of present, ITL is holding over 41 million shares or 41.78 per cent of Sotrans’ charter capital.

Under the proposal, Sotrans has approved ITL to increase its ownership to 100 per cent of the total voting shares of STG without making a mandatory public offering in line with Vietnamese regulations.

Accordingly, ITL will purchase STG stakes from existing shareholders or increase its ownership in companies holding a stake in STG.

According to its 2019 financial statement, Sotrans has generated over VND1.8 trillion ($78.26 million) in revenue and VND122.6 billion ($5.33 million) in after-tax profit, down 22.2 per cent against 2018.

Sotrans’ returns on asset and returns on equity are lower than other transport and logistics firms like Gemadept, Viettel Post, and Transimex.

Beside ITL, Vietnam Electrical Equipment JSC (GELEX) is another major stakeholder holding a 54.78 per cent stake in Sotrans. By owning a controlling stake in the company, GELEX has extended its reach to the logistics industry beyond its core electricity business.

In 2016-2017, Gelex and ITL have been vying for the acquisition of Sotrans, following State Capital Investment Corporation’s (SCIC) move to offload its entire 47.8 per cent at Sotrans in 2015. With Sotrans’ latest proposal, ITL is expected to become the winner of the race.

Chief operating officer of ITL, Amanda Rasmussen, told VIR that the firm will invest an additional $70 million in 2020. “The investment will further strengthen our position as a leading player in Vietnam and Indochina through further mergers and acquisitions and asset development.”

ITL is also aiming to become the national champion – the leading logistics company of Vietnam and the region – as well as a $500 million company in the next two years.

(Source : Vietnam Investment Review  – VIR)