SBT’s sugar mill. The company has announced sale of preference stock worth $28 million to German development finance institution DEG. — Photo courtesy of TTC

Thanh Thanh Cong-Bien Hoa JSC (SBT) on July 26 announced that the German development finance institution DEG, owned by the German Government, invested US$28 million to buy convertible preferred dividend stocks at VND30,000 ($1.26) each, 84 per cent higher than SBT’s market price on July 25.

The preferred stock will be subject to transfer restrictions for at least one year from the issuance day.

The preferred dividend period will be 6.5 years with a fixed dividend of 5.5 per cent a year for the first 1.5 years and based on mutual agreement for the following years.

The stocks will not have voting rights but can be converted into common stocks by agreement between the two parties. The conversion price will be decided mutually at the time of conversion but will not exceed VND38,000 ($1.63).

The transaction is expected to be completed in September, increasing SBT's capital by 3.7 per cent to VND6.084 trillion ($262.14 million).

The company will use the money to make strategic investments in the sugar business of HAGL in Laos it bought in 2017 and mechanise and expand its organic sugar production.

SBT said this year it has also invested in Cambodia to expanding its sugarcane sourcing area in Indochina to 70,000ha.

In the HCM Stock Exchange’s latest update to the blue-chip VN30 Index in July 2019, a basket of 30 stocks with the largest market capitalisation and highest liquidity, SBT retained its place and remains the only company from the sugar industry in the VN30 basket. — VNS