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PV Gas South (PGS) to buy out joint-venture
PetroVietnam Gas South JSC (PGS) has decided to buy out Vietnam LPG Co Ltd (VT-Gas) for a mere VND1,000 (US$0.043).
VT-Gas was founded on February 6, 2016 as a joint-venture between PGS and the Thai oil and gas business PTT Public Co Ltd.
VT-Gas has charter capital of VND100 billion and PGS will increase its capital by VND60 billion by providing cash and/or assets from its eastern branch.
PGS will add a real estate division to VT-Gas’ business portfolio and appoint its deputy director as the latter’s new chairman.
The southern gas company will hold its annual shareholders’ meeting on April 16 to discuss business activities and targets for 2020.
The company in 2019 earned VND6.38 trillion in revenue, accomplishing 97 per cent of its target.
Its pre-tax profit was VND93.1 billion, equal to 90 per cent of the plan.
The company said the performance was lower than expected because crude had traded below the expected levels in 2019.
PGS said it would cut total revenue and pre-tax profit targets in 2020 to VND6.18 trillion and VND65.36 billion.
Brent crude and the US benchmark West Texas Intermediate (WTI) plunged about 20 per cent to trade at $32.6-36.2 a barrel, losing about 50 per cent in two months to hit two-year lows.
PGS expects crude will finish 2020 at $60 a barrel.
PetroVietnam Gas South JSC in late 2019 held an extraordinary shareholders’ meeting, in which shareholders rejected a proposal to allow PetroVietnam Gas to increase its stake in the firm to more than 51 per cent from 35.2 per cent.
PGS had earlier planned to sell 16.1 million shares to PetroVietnam Gas for nearly VND377 billion to increase its working capital.
PGS shares (HNX: PGS) slumped 4.5 per cent to end Monday at VND22,000.
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