At the meeting to publicize the debt-stricken company’s liability state , Vo Thanh Hung, head of the inspectorate team formed by the municipal government, cited the latest figures as saying that Bianfishco’s debt has been enlarged by VND27.7 billion (US$1.32 million).
Earlier the beleaguered company was found to have an outstanding debt of VND1.54 trillion ($73.9 million) to nine banks, a credit institution, and a number of farmers on fish purchase.
“The total assets of the company were some VND2.07 trillion, with short-term capital worth VND1.18 trillion,” said Hung, citing audit results conducted in 2010.
Between its foundation in 2007 and April, 2011, Bianfishco posted stable business operations, with annual contribution to the Can Tho budget worth $42.8 million in 2010, and $47.6 in 2011, said Hung.
The company began to face financial hurdles and sink into debts in mid-2011, thanks to tightened credit and the divestments of many banks.
“The company’s poor and haphazard investments in non-core sectors are also to blame for the debts,” stated Hung.
At present, Bianfishco is running a large number of facilities in Can Tho, including a catfish processing plant with daily production of 500 tons, the Binh An Institute for Aquaculture Research, a 10,000-ton freezing warehouse, a by-product processing plant, a collagen producing factory, and a center for producing fish breeds.
“Bianfishco is calling on banks to extend its liabilities, or reevaluate its assets to increase the loans to be offered to the company,” said Hung.
No bankruptcy announced yet
Nguyen Thanh Son, Can Tho city chairman, said no move or consideration has been made to prosecute Pham Thi Dieu Hien , the company’s former CEO, or force the company to declare bankruptcy.
“Everything must be done as per law,” said Son.
The chairman said Can Tho city will always be willing to assist Bianfishco to overcome the crisis, but the company has refused to cooperate.
“[Bianfishco] must show the financial report for 2011 in order to resolve the problem.”
The idea was shared by Hung, who said solutions can only developed based on the financial report.
“The municipal authorities have also developed plans to handle the case if the company goes bankrupt,” added Hung.
Hien still in the US
Regarding the public skepticism on whether or not Hien, the company’s former CEO, is receiving medical treatment in the US, Nguyen Huu Loi, deputy standing secretary of the municipal Party Union, said authorities have yet to fully acknowledge the case.
Meanwhile, Hung said Hien is still in the state of California, despite the fact that the city’s government has ordered her to return to settle the debts.
He added that while Hien has reportedly authorized her husband, Tran Van Tri, to assume her CEO post at Bianfishco, the authorization has yet to be notarized, as required by law.
“Bianfishco’s board of directors should complete all necessary procedures for the authorization,” urged Can Tho people’s committee.
“In case they fail to do the task, it is ordered that Hien come back to Vietnam to handle the case.”
The municipal government also ruled that Bianfishco propose the most effective plans to settle its debts to farmers and other institutions.
“The company should also discuss with banks and its shareholders a restructuring as per law,” it said.