Pangasius farmers. (Photo: Bianfishco)
Bianfishco promises to repay farmers this month
Tuesday, August 28, 2012, 02:20 (GMT + 9)
The Saigon Hanoi Commercial Joint Stock Bank (SHB) will henceforth be involved in restructuring all activities of Binh An Seafood Joint Stock Company (Bianfishco), both parties have announced.
Tran Van Tri, CEO of Bianfishco, said that after a lengthy process, Can Tho City has now officially certified a new business registration license for the company. The license states that SHB, the largest shareholder of Bianfishco with a 50 per cent stake, will be overseeing the firm’s operations.
Per the new license, Tri is the legal representative of the company, replacing former director of Bianfishco and his wife Pham Thi Dieu Hien.
Tri holds 2 per cent of Bianfishco's shares, VNS reports.
He will also prioritize the repayment of all farmers’ back debts, as they had not yet been paid for pangasius they sold to Bianfishco many months ago, he said. Bianfishco and SHB agreed on a mode of repayment that farmers will accept, SGGP reports.
Several banks will now have to reduce their interest rates on loans for these farmers and businesses to a maximum of 11 per cent per year -- the lowest market interest rate currently available. Stricken customers could be given another two years to pay back debts.
Tri commented that due to the economic crisis, Bianfishco had difficulty repaying loans after it expanded and invested in many projects. This year, it has been able to clear up to VND 700 billion (USD 33 million) in dues.
Further, the company has had trouble obtaining credit from banks, which led to a stop in production and in turn left Bianfishco unable to repay farmers.
Tri apologized to farmers and partners and vowed that the firm will give its fish processing plant to the farmers in question if it misses the payment deadline next October.
He said Bianfishco will soon have cash to repay them and will join forces with Debts and Assets Trading Corp and other banks to streamline debt clearance procedures and get the firm back on track.
The company officially restarted operations at its pangasius (tra catfish) processing and export plant in Tra Noc Industrial Park in Can Tho City in May.
Bianfishco still owes farmers VND 200 billion (USD 9.4 million).
Nguyen Van Le, CEO of SHB, promised that in the coming weeks the company will invite farmers to declare their debts and by September will clear at least 30 per cent of the loans. Moreover, SHB and shareholders and related industries will quickly lay down a plan to restructure operations.
SHB will provide disbursement of capital to Bianfishco to buy additional raw material and for working capital. Simultaneously, negotiations with major creditors will be implemented to convert debt into equity, raise capital from VND 500 billion (USD 24 million) to VND 1.2 trillion (USD 58 million) and to boost the financial capacity of the company.
In March, Bianfishco laid off its 2,400 workers indefinitely. However, The company hopes to be running smoothly by 2013.
- Bianfishco lays off workers indefinitely
- Bianfishco considers selling its plant to pay off debts
By Natalia Real