7th Mar 2025 12:43
(Alliance News) - Vietnam Enterprise Investments Ltd on Friday said it is introducing a five-year performance-related conditional tender offer.
The investor in listed equities in Vietnam said the tender offer will be conditional on its net asset value total return underperforming its reference index, the Vietnam Ho Chi Minh Stock Index, over the five-year period from March 31 to the end of March 2030.
The firm said the board has confidence it will outperform the index over the next five years.
"Nonetheless, in consultation with the investment manager, the board has decided that, should performance be below the reference index, there should be a mechanism for shareholders to realise up to 100% of their interests in the company," Vietnam Enterprise Investments said.
It said any tender offer will be at a price "equal to the realisation proceeds of a tender pool created by reference to the then prevailing NAV less costs of the tender offer".
Vietnam Enterprise Investments said it provides an alternative mechanism and a shorter timeframe for the return of capital to shareholders than the discontinuation resolution to be voted on at the 2025 and 2030 general meetings.
It said the conditional tender offer does not affect its approach to discount management, and it will continue to buy back shares when in shareholders' interests.
Chair Sarah Arkle said: "The board remains confident in the company's future prospects. However, we are disappointed with the level of the discount at which the company's shares have been trading, which has widened in common with other listed investment company discounts.
"[The conditional offer] ensures that, in the event of underperformance against the reference index, shareholders who wish to exit have a structured option, while long-term investors can continue to benefit from Dragon Capital's investment process and commitment to active fund management, which will remain unchanged. We believe this strikes the right balance between confidence in our future performance and our commitment to shareholder value."
Vietnam Enterprise Investments shares were up 0.4% at 598.06 in London on Friday afternoon.
By Michael Hennessey, Alliance News reporter
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