The State Securities Commission of Vietnam (SSC) has just announced the cancellation of the public company registration of CJ Cau Tre from March 31.
CJ Cau Tre was formerly Direximco Company, which was established in 1979-1980. It was equitised on March 31, 2005 and renamed to CJ Cau Tre Foods JSC (CJ CTE JSCO) with VND117 billion ($5.15 million) charter capital.
2017 was a rather successful year of business for CJ Cau Tre as it recorded VND975 billion ($43 million) in revenue, up 23 per cent, and VND80.4 billion ($3.54 million) in after-tax profit, 80 times as much as in the same period last year. With this small profit, CJ Cau Tre has gotten rid of its accumulated losses.
However, profit mainly came from the outstanding income of VND128 billion ($5.65 million), which was part of compensation and assistance for relocating the former headquarters in Tan Phu district to Hiep Phuoc factory, under a co-operation agreement with TTC Land.
The parent company of CJ Cau Tre is CJ Cheiljedang Corporation. In late 2016, CJ Cheiljedang Corporation bought 47.33 per cent stake from three big shareholders of CJ Cau Tre, and raised its holdings to 51.6 per cent in March 2017. This corporation also spent VND187 billion ($8.24 million) acquiring a 71.6 per cent stake in Saigon Trading Group (Satra), which holds 25 per cent of CJ Cau Tre.
In early 2018, SSC also cancelled the public company registration of Vietnam Food Industries JSC (VIFON).
No longer a public company, they will not have to comply with a series of these obligations. Small shareholders will not receive updated official information and their rights could be affected by less transparent information flows.