Doan Nguyen Duc, board chairman at Vietnamese agricultural giant Hoang Anh Gia Lai JSC (HAGL), intends to sell Hoang Anh Gia Lai Hotel in Pleiku City, situated in the Central Highlands province of Gia Lai, to make debt payments.
The management board of the firm has reached a consensus on liquidation of unproductive properties, especially the sale of Hoang Anh Gia Lai Hotel, which was the first four-star lodging facility in the Central Highlands region.
Starting its operation in 2005, the hotel lies near Phu Dong Square in the heart of Pleiku City and includes 117 rooms.
The proceeds from the hotel sale will be used to pay the principal and interest on the bonds issued in 2016 at the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV), said Duc.
The selling price has yet to be announced.
The firm had earlier sold two resorts in Quy Nhon City in the south-central province of Binh Dinh, and in Da Lat City under Lam Dong Province, a hotel in Da Nang City, and another in Yangon, Myanmar.
Due to a financial hit, Duc and HAGL withdrew from the hotel and tourism market over 10 years ago.
As of the end of September, the firm had delayed the payments of the principal and interest for the bonds issued in 2016 with a total value of more than VND4 trillion (US$165.8 million).
A few days ago, the firm paid VND380 billion ($15.6 million) for the principal.
The firm will pay the rest by 2023.
Speaking at a recent meeting, chairman Duc said that Vietnamese automaker Thaco, owned by billionaire Tran Ba Duong, owed HAGL VND1.6 trillion ($65.9 million)
This year, Thaco will pay the firm VND500 billion ($20.6 million).
In its semi-annual financial statement, HAGL was sitting on a mountain of bond debts valued at over VND5.5 trillion ($226.5 million).
HAGL shareholders have recently agreed to issue shares to mobilize VND1.3 trillion ($53.6 million) for the firm to pay debts.
The HAGL management board passed a non-public offering plan, with each share offered at VND10,000 ($0.41).
During the first half of 2023, HAGL booked upwards of VND3.14 trillion ($129.6 million) in revenue, up 55 percent year on year, and earned nearly VND405 billion ($16.7 million) in after-tax profits.