Sabeco officially dismisses Vu Quang Hai

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Báo Đầu Tư English - 7 month(s) ago 5 readings

On February 16, 2017, Vu Quang Hai, the son of sacked former Minister of Industry and Trade Vu Huy Hoang, was officially dismissed from his positions at Saigon Beer, Alcohol and Beverage Corporation (Sabeco) as member of the board of directors and deputy general director.

Fred DeLuca, president and co-founder of the sandwich chain Subway. Subway plans to open the first shop in Vietnam in August this year - Photo: Song Nguyen / Source: SGT

In the extraordinary general meeting on February 16, shareholders have dismissed many members of the board of directors and management.

Specifically, the attendees have agreed to replace Vu Quang Hai by Nguyen Thanh Nam, current deputy general director of Sabeco. Chung Chi Dung, member of the management board in 2013-2018, was also replaced by Nguyen Van Minh.

In the middle of June 2016, Vietnam Association of Financial Investors (VAFI) has called attention to Hai’s wrongful appointment.

Hai, 29 years old, is the son of Vu Huy Hoang, former Minister of Industry and Trade. Hai used to be the leader of PetroVietnam Finance Corporation (PVFI), deputy general director of Vietnam Trade Promotion Agency, and inspector of Vietnam National Tobacco Corporation before finally being moved to Sabeco.

His appointment was blamed on the lack of transparency and was found to have violated the Vietnam Anti-Corruption Law.

In November 2016, the Secretariat of the Central Committee ordered disciplinary action against Hoang on charges of nepotism. Hoang, who then already retired from his post as the minister, was deprived of the “former minister” title.

After this scandal, Vu Quang Hai has submitted a letter to the Ministry of Industry and Trade, asking for work at Sabeco at any other position. A representative told local media that his request will be considered later.

Nguyen Thanh Nam, who will be taking over the position of Hai, is now the representative of the State's holding of over 141 million Sabeco shares, which is equivalent to the chartered capital of the company. Besides, he holds 1,800 Sabeco shares himself, and his wife and brother hold 7,200 shares.

Despite the huge scandal, Sabeco reported an all-time record profit in its 2016 consolidated financial report. According to experts of Viet Capital Securities, Sabeco’s profit margin is 11 per cent and it has potential to further flourish in the future. Moreover, the experts also recommended a line of action for Sabeco, such as increasing its ownership in the factories, cutting down on transportation costs, and diversifying its products. Economist Le Dang Danh added that by avoiding nepotism and enhancing human resources management, Sabeco could cut down 20-30 per cent of its costs.

On January 3, insurer Bao Viet Holdings sold 500,000 shares of Sabeco at the negotiated price of VND190,000 ($8.5) apiece. The state also announced plans to divest of the entirety of its shares. This divestment plan is projected to be executed in April 2017. Many foreign investors have expressed interest in buying stakes in Sabeco, including big international beverage makers Kirin, Asahi Group Holdings, Heineken, Singha, ThaiBev, and AB InBev.

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By Trang Vu

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