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MASECO
2009
78A Nguyen Van Troi St. - Ward 8 - Phu Nhuan Dist. - Hochiminh City
Tel : 08.38444861 - Fax : 08.38443264 Website : www.maseco.com.vn
PROSPECTUSPROSPECTUS
Phu Nhuan Service Joint Stock Company Prospectus
HOCHIMINH CITY STOCK EXCHANGE ISSUES CERTIFICATE OF SHARE
OFFERING, WHICH SOLELY MEANS THAT THE OFFERING HAS BEEN EXECUTED
IN COMPLIANCE WITH REGULATIONS OF RELEVANT LAW AND HAS NO
IMPLICATION TO THE GUARANTY OF THE SHARE VALUE. ALL DECLARATIONS
CONTRARY TO THIS SHALL BE ILLEGAL.
PROSPECTUS
PHU NHUAN SERVICE JOINT STOCK COMPANY
(Business License No. 4103000625 dated 2 October 2001 and the 9th updated Business
License dated 14 November 2008 issued by the Department of Planning and Investment of
HCMC)
SHARE OFFERING TO THE PUBLIC
(Registration for offering No 504/UBCK-GCN issued by President of State Securities
Commission dated 27January 2010)
This prospectus and supplementary documents are provided at:
1. Phu Nhuan Service Joint Stock Company
Head Office: 78A Nguyen Van Troi, Ward 8, Phu Nhuan District, HCMC
2. Empower Securities Joint Stock Company
* Head Office: Floor 1&2 Chuong Duong ACIC Building
225 Ben Chuong Duong, District 1, HCMC
* Hanoi Branch: Floor 3, 249 Tran Dang Ninh, Cau Giay District, Hanoi
Responsible person for News Release:
Mr. Nguyen Xuan Han Telephone: (84-8) 38 444 861
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Phu Nhuan Service Joint Stock Company Prospectus
PHU NHUAN SERVICE JOINT STOCK COMPANY (Business License No. 4103000625 dated 2 October 2001 and the 9th updated Business
License dated 14 November 2008 issued by the Department of Planning and Investment of
HCMC)
SHARE OFFERING TO THE PUBLIC
Ticker: Phu Nhuan Service Joint Stock Company Stock
Par value: VND10,000/share
Offer price:
- Existing shareholders : VND20,000/share
- Employees : VND25,000/share
- Strategic investors : negotiable but not lower than VND20,000/share
Total number of shares to be offered : 9,000,000 shares
Total offer value :VND90 billion (at par value)
AUDIT ORGANIZATION:
AUDITING AND INFORMATICS SERVICE LTD COMPANY
Head Office:142 Nguyen Thi Minh Khai, District 3, HCMC
Telephone: (84-8) 39 305 163 Fax: (84-8) 39 304 281
CONSULTING ORGANIZATION:
EMPOWER SECURITIES JOINT STOCK COMPANY
Head Office: Floor 1&2 Chuong Duong ACIC Building
225 Ben Chuong Duong, District 1, HCMC
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Phu Nhuan Service Joint Stock Company Prospectus
Telephone: (84-8) 38 386 068 Fax: (84-8) 38 386 896
TABLE OF CONTENTS
I. RISK FACTORS 5
1. ECONOMIC RISK 5 2. LEGAL RISK 5 3. INFLATION AND EXCHANGE RATE RISK 6 4. MANAGEMENT RISK 6 5. ISSUING RISK 6 6. DILUTION RISK 7 7. PARTICULAR RISKS 8 8. OTHER RISKS 8
II. MAIN PARTIES RESPONSIBLE FOR THE PROSPECTUS 9
III. ABBREVIATION 9
IV. INFORMATION OF THE COMPANY 10
1. GENERAL INFORMATION 10 2. ORGANIZATIONAL STRUCTURE 13 3. MANAGEMENT STRUCTURE 15 4. LIST OF SHAREHOLDERS WITH 5% OWNERSHIP, FOUNDING SHAREHOLDERS AND
SHAREHOLDER STRUCTURE 20 5. LIST OF PARENT COMPANIES AND SUBSIDIARIES OF THE COMPANY 22 6. BUSINESS ACTIVITIES 22 7. BUSINESS RESULTS IN RECENT YEARS 34 8. POSITION OF THE COMPANY COMPARED WITH OTHER CORPORATIONS IN THE
INDUSTRY 35 9. LABOR POLICY 37 10. DIVIDEND POLICY 39 11. FINANCIAL OPERATION 39 12. BOARD OF DIRECTORS, BOARD OF MANAGEMENT, SUPERVISORY BOARD, CHIEF
ACCOUNTANT 43 13. FIXED ASSETS 50 14. REVENUE AND DIVIDEND PLAN FOR THE PERIOD 2009-2010 51 15. CONSULTING ORGANIZATION’S ASSESSMENT OF MASECO’S REVENUE AND DIVIDEND
PLAN 51
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Phu Nhuan Service Joint Stock Company Prospectus
V. SHARE OFFERING 52
VI. THE PURPOSE OF SHARE OFFERING 56
VII. ACTION PLAN FOR THE USE OF FUND FROM SHARE OFFERING 60
VIII. RELATED PARTIES TO THE SHARE OFFERING PLAN 61
IX. APPENDICES 62
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Phu Nhuan Service Joint Stock Company Prospectus
I. RISK FACTORS
1. Economic risk
The fluctuation of major macroeconomic factors such as economic growth rate, inflation,
interest rate and exchange rate policy as well as economic development policies of the
Government have direct or indirect impacts on the operation of enterprises in general and
the Company in particular. When inflation, interest rate and exchange rate tend to
fluctuate considerably in the future, operation of enterprises will be affected depending
on their business characteristics and financial condition.
Currently, Vietnam has been adversely affected by the global financial crisis and
economic recession; therefore, general business and the Company in particular will be
affected if Vietnam’s economic growth continues to slow down in the upcoming period.
However, according to the forecast from economic experts that Vietnam’s GDP growth
rate is at 5% in 2009 and can be recovered soon in the end of 2009 and beginning of
2010, the Company’s investment in profitable projects is appropriate to capture future
business opportunities.
The Company does not only operate in any particular sector but various sectors including
the sectors in development phrase such as electronic products, agricultural products,
hotels and restaurants services. In recent years, these business sectors have made such
good revenues and profits that these investments are not only essential for the Company
but also in accordance with the market trends. In particular, the two small-scale projects
of office buildings and high-rise apartments which do not face exit barriers under
unfavorable circumstances are appropriate investments which can both capture business
opportunities and overcome risks by contingencies.
It is said that overall economic risk is not significant to the operation of the Company.
2. Legal risk
The legal system of Vietnam has been rapidly supplemented and improved, but it still has
some limitations in practices that may adversely affect long-term business development
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Phu Nhuan Service Joint Stock Company Prospectus
strategy of enterprises in general and the Company in particular. In addition, the
Company’s share public offering is regulated by securities law and monetary policies of
the State, which are currently in the stage of construction and completion. If there are
unpredictable changes in these relevant legal policies, the Company’s operations and
share price will be affected.
In order to reduce legal risk, the Company has been actively updating necessary legal
information, doing research and enhancing the ability to forecast changes in legal
policies. Therefore, it can be said that overall legal risk is not significant to the operation
of the Company.
3. Inflation and exchange rate risk
All investment projects of the Company have been conducted in local currency so the
depreciation of value of Vietnamese dong does not influence the profits from investment
despite its partial influence on production price structure such as interest cost of loans and
the price of imported raw materials.
4. Management risk
The Company has been developed in both revenues and business scale which in turn can
cause management risk related to management hierarchy or staff qualifications. The
Company has implemented several methods for the enhancement of management system
and leadership skills of staff to minimize management risks:
Standardize management system across the Company and each department.
Implement ERP solutions for information management.
Regularly update management skills for operating staff.
5. Issuing risk
The expected number of shares offering is 9,000,000 shares, among which the number of
share offering to existing shareholders and staff is 5,550,000 shares (accounting for
61.7% of total estimated shares offer). This issuing plan was approved in the General
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Phu Nhuan Service Joint Stock Company Prospectus
Shareholders’ Meeting in 2008 and 2009 with the agreement of all shareholders attended,
which guarantees the success of the issuance.
The remaining 3,450,000 shares is expected to offer to strategic investors (accounting for
38.3% of total expected share offer). To ensure the success of this offering plan, the
Company has also collaborated with advisory organizations to survey the needs of
investors who highly appreciate the Company’s investment projects and show interest in
the Company’s share offering. Therefore, 80% of total shares issued is expected to be
successfully offered.
6. Dilution risk
Share dilution happens because of reasons below:
Share issuance to existing shareholders at the price of VND20,000 per share which is
lower than the market price at the date of closing shareholder list.
Share issuance to the employees at the price of VND25,000 per share which is lower
than the market price at the date of closing shareholder list.
Based on net profits of the last four quarters, average shares outstanding and share market
price during the last three months, the share price and EPS after the issuance are
presented in the table below:
No. Item No. of shares Price Value
(VND mil) 1 Shares outstanding 6,000,000 30,000 180,000 2 Issue to existing shareholders 5,000,000 20,000 100,000 3 Issue to employees 550,000 25,000 13,750
4 Issue to strategic investors (at estimated price) 3,450,000 29,000 100,050
Total 15,000,000 393,800 Adjusted share price 26,253
No. Item Unit Value 1 Net profit of last 4 quarters VND mil 34,4472 Average shares outstanding Shares 5,826,923
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Phu Nhuan Service Joint Stock Company Prospectus
3 EPS before issuance VND/share 5,9124 Adjusted rate Time 1.145 EPS after issuance VND/share 5,173
The share price and EPS after the issuance decrease by 12%. However, dilution risk
depends on profitability of the projects which used fund from the issuance. Particular
investment plan and feasibility study presented in Section VI.2 promises high return on
capital which decreases dilution risk from the share offering.
7. Particular risks
Local producers of electronic goods tend to face strong competition with Chinese or
Japanese importers in both price and advanced technology. Vietnam’s entry to WTO
creates opportunities for Vietnamese exporters to increase export revenues by
penetration, on the other hands creates difficulties when tarriff quotas and State subsidies
are removed.
In recent years, although import duties of electronic goods has been cut down to 0%-5%
that created a competition risk in the sector, the Company still achieved an average
annual growth rate of 30%. The Company’s competitive strategy does not only focus on
pricing but also the development of technology, distribution channels, warranty,
promotion program as well as branding and marketing strategies.
Besides the implementation of business policy, the Company also develops solutions
dealing with unfair competition such as fake products and violation of intellectual and
industrial property rights, by full registration of their trademarks and hiring protection
advisory to minimize competition risk. Competition risk is not significant to the
Company’s business as the Company has had a good brand, stable market share and
continuous development in many years of operation.
8. Other risks
Other risks such as earthquakes, fire, flood, war or dangerous diseases may cause
significant damage for properties, human and business operation of the Company.
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Phu Nhuan Service Joint Stock Company Prospectus
However, the Company has acquired insurance policies for properties and business
operation to minimize the possibility of material damages.
II. MAIN PARTIES RESPONSIBLE FOR THE PROSPECTUS
1. Issuing Organization – Phu Nhuan Service Joint Stock Company
Ms. Truong Thi Thanh Tam Chairwoman of Board of Directors
Mr. Nguyen Xuan Han General Director
Ms. Tran Thi Lua Chief Accountant
We guarantee that all information and data presented in this Prospectus conforms to data
that is factual and has been collected and investigated to the possible extent.
2. Consulting Organization – Empower Securities Joint Stock Company
Ms. Tran Duong Ngoc Thao Acting General Director
This Prospectus is a part of the share offering document jointly made by Empower
Securities Joint Stock Company based on a consulting contract with MASECO. We
guarantee that the analysis, assessment and wording in this Prospectus have been done on
a reasonable and cautious basis according to the information and data provided by
MASECO.
III. ABBREVIATION
The Company : Phu Nhuan Service Joint Stock Company
Issuing Organization : Phu Nhuan Service Joint Stock Company
MASECO : Phu Nhuan Service Joint Stock Company
SSC : State Securities Commission
HCMC : Ho Chi Minh City
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Phu Nhuan Service Joint Stock Company Prospectus
BOD : Board Of Directors
IV. INFORMATION OF THE COMPANY
1. General Information
1.1. History of incorporation and development
Phu Nhuan Service Joint Stock Company (MASECO) was formerly Phu Nhuan Material
and Travel Service Company, established in 1991 based on the merging of Phu Nhuan
District Material Company (established in 1978) and Phu Nhuan District Service
Company (established in 1983).
MASECO was transformed from Phu Nhuan Material and Travel Service Company (a
State-owned company) under Decision No.971/QD-TTg dated 2 August 2001 of the
Prime Minister. At the time of establishment on 10 May 2001, the chartered capital of the
Company was VND20 billion, 25% of which was contributed by State shareholders.
On October 2004, the State shareholders transferred all shares to the rest of existing
shareholders under Offical Document No.2179/UB-CNN of the HCMC People's
Committee.
Till now, MASECO has had two share offerings to increase their chartered capital:
In 2007: 1,000,000 shares for existing shareholders to increase chartered capital by
VND10 billion.
In 2008: 3,000,000 share bonus to increase chartered capital by VND30 billion.
According to the audited financial reports as at 31 December 2008, the Company’s
chartered capital was VND60 billion (equivalent to 6,000,000 shares).
The General Shareholders’ Meeting in 2008 and 2009 decided that the Company
continued to issue additional shares in 2009 and 2010, particularly, offering to existing
shareholders, staff and strategic investors with total number of 9,000,000 shares
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Phu Nhuan Service Joint Stock Company Prospectus
(equivalent to VND90 billion in par value) to increase the chartered capital to VND150
billion.
1.2. Achivements
Operating in the fields of trade, export and import, production of electronic products,
hotels, restaurants services and real estate business, the Company has achieved a high
growth rate in revenue, export values, profits, income and living standard of staff and
contributed to the State budget as well as social welfare in many of previous years.
Awards:
1. Third rank Labour Medal awarded by the State President for excellent achievements
in 1999-2003.
2. HCMC Business Excellence Award 2004 by HCMC People’s Committee
3. Excellent Achievements Award 2003-2008 by the Prime Minister
4. Prestigious Export Enterprise Award 2004-2008 by the Ministry of Trade
5. Sustainable Development Award 2007-2008 by the Ministry of Industry and
Commerce.
6. Outstanding Trade and Service Enterprise Award 2008 by the Ministry of Industry
and Commerce.
7. Prize for Vietnamese High-quality Goods and Top ten Vietnamese Brand 2006, 2008
8. TOP 500 of Biggest Private Enterprises in Vietnam 2007-2008 voted by VNR500
Program of Vietnamnet.
9. Vietnamese Strong Brand 2000-2008
10. Excellent Union Award by HCMC Labor Union
1.3. Introduction about the Company
MASECO was established based on Decision No.971/QD-TTg dated 2 August 2001 of
the Prime Minister, transformed from Phu Nhuan Material and Travel Service Company.
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Phu Nhuan Service Joint Stock Company Prospectus
1. Name: PHU NHUAN SERVICE JOINT STOCK COMPANY
2. Abbreviated name: MASECO
3. Logo:
4. Chartered capital: VND60 billion
5. Head Office: 78A Nguyen Van Troi, Ward 8, Phu Nhuan District, HCMC
6. Telephone: (84-8) 3844 4864 Fax: (84-8) 3844 3264
7. Website: www.maseco.com.vn
8. Email: [email protected]
9. The 1st Business license No.4103000625 dated 2 October 2001, the 9th license dated 14
November 2008 issued by the Department of Planning and Investment of HCMC.
Lines of business:
1. Export and import of consumer goods and production materials; production for
exports
2. Real estate business, hotels, restaurants, office, warehouse, shops and civil
construction.
3. Trade of materials, chemical materials, machinery, metal electrical goods, electrical
appliances, electronics, computers, cosmetics, clothing, linen, fuel, construction
materials, fertilizer, pesticides, food, wine, beer, tobacco, domestically produced and
imported consumer goods.
4. Delivery of domestic and exported goods.
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Phu Nhuan Service Joint Stock Company Prospectus
5. Production, processing and assembly of machineries, electrical equipments and
software technology.
6. Karaoke services, entertainment, sports; music recording.
7. Production and trade of fixed phones, mobile phones, spare parts of
telecommunication equipments; ringtone installation services, lyrics and images for
mobile phones.
8. Online information services
9. Advertising service
10. Motobikes security services
11. Other business as stipulated by law.
Tax file number: 0 3 0 2 4 1 6 3 6 4
Bank account:
VND:
- 025.100.100.2457 : Vietcombank – Binh Tay Branch
- 310.100.000.15483: Bank of Investment and Development Vietnam – HCM
Branch
USD:
- 025.137.100.2467 : Vietcombank – Binh Tay Branch
- 310.103.700.02726: Bank of Investment and Development Vietnam – HCM
Branch
2. Organizational Structure
Head Office of PHU NHUAN SERVICE JOINT STOCK COMPANY
78A Nguyen Van Troi, Ward 8, Phu Nhuan District, HCMC
Telephone: (84-8) 3844 4864 Fax: (84-8) 3844 3264
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Phu Nhuan Service Joint Stock Company Prospectus
Related entities:
a) Hanoi Branch:
Address: 121 Nguyen Chi Thanh, Dong Da District, Hanoi
Established at the end of 2006
Produce and trade electronic and electrical goods
b) Gia Lai Branch:
Address: 1028 Hung Vuong Street, Chu Se Town, Gia Lai Province
Establish at the beginning of 1999
Produce to export agricultural products such as coffee and pepper.
c) Electronic Service Center:
Address: 7 Hoang Minh Giam, Phu Nhuan District, HCMC
Established in 1995
Produce and trade electronic and electrical goods, music CDs and karaoke DVDs.
Shops:
- Show room and Waranty center No.1: 7 Hoang Minh Giam, Ward 9, Phu
Nhuan District, HCMC.
- Showroom and Waranty center No.2: 218A Phan Dinh Phung, Ward 1, Phu
Nhuan District, HCMC.
- Showroom and Waranty center No.3: 131 Tran Huy Lieu, Ward 8, Phu Nhuan
District, HCMC.
- Multimedia Services: 218A Phan Dinh Phung, Ward 1, Phu Nhuan District,
HCMC.
- Production Factory: 7 Hoang Minh Giam, Ward 9, Phu Nhuan District,
HCMC.
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Phu Nhuan Service Joint Stock Company Prospectus
d) Hoa Mai Hotel:
Address: 75 Hoang Van Thu, Ward 15, Phu Nhuan District
2-star hotel with 30 bedrooms
Also provide restaurant and wedding services, conference and karaoke services.
HEAD OFFICE
HANOI BRANCH
GIA LAI BRANCH
HOA MAI HOTEL
ELECTRONIC SERVICE CENTER
REAL ESTATE TRADE DIVISION
EXPORT-IMPORT DIVISION
Factory Multi Media Service
Showroom No.1
Showroom No.2
Showroom No.3
MASECO
3. Management Structure
General Shareholders’ Meeting: General Shareholders’ Meeting comprises all
shareholders with voting rights and delegation and acts as the highest decision-making
body of the Company. General shareholders have the following rights:
Decide the type of shares and total number of shares offering as well as annual
dividend policy of each share type.
Elect and dismiss the members of the Board of Directors and Supervisory Board.
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Phu Nhuan Service Joint Stock Company Prospectus
Investigate and decide how to deal with breaches committed by the Board of
Management and the Control Board which cause damage to the company and its
shareholders.
Decide to dissolve or restructure the Company
Approve amendments or supplements of the Charter, except the adjustment of
chartered capital by issuing more shares in the limit of number of shares offering as
stated in the Charter.
Approve the reports and recommendations of Board of Directors on business
operation results, balance of financial year, distribution or use of profits, dividend
payment and use of fund based on the reports of Supervisory Board.
Approve the direction of business development, business and investment objectives of
the next year; make decisions on joint-venture and corperative production; review and
make solutions to overcome financial problems of the Company.
Make decisions on investment or asset liquidation which value is equal or greater than
50% of book value of total assets.
Make decisions on repurchasement of more than 10% of total shares of each type
offered.
Other rights as stipulated in the Charter and current Law.
Board of Directors: has 7 members who have the rights to act on behalf of the Company
except the rights of General Shareholders’ Meeting which can not be delegated. BOD
has the following rights:
Decide the development strategy of the Company
Decide to offer shares and bonds; valuate assets whose funding is not in Vietnamese
dong in the limit of the number of shares offering; decide to mobilize capital by other
methods.
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Phu Nhuan Service Joint Stock Company Prospectus
Make decisions on investment plans; approve fund estimation, the design and
payment of projects.
Make decisions on market penetration method, marketing and technology; approve
trade and loan contracts and other contracts with the total value of lower than 50% of
book value of total assets.
Elect and dismiss the General Director, Deputy General Directors and Chief Account;
decide the salary and bonus and other benefits of the Board of Management.
Make decisions on organizational restructuring, management regulations,
establishment or dissolution of subsidiaries, branches, representative offices and the
share purchase of other enterprises.
Other rights as stipulated in the Charter and current Law.
Supervisory Board: has 3 members as appointed by the General Shareholders’ Meeting
to work on behalf of shareholders in supervising all business management and execution
of the Company. The Supervisory Board has the following rights:
Assess the legality in management, business operations, accounting entries, financial
reports, list of shareholders, Minutes of Shareholders’ and BOD’s Meeting.
Conduct due diligence on annual financial reports
Make recommendation on the modification of management structure
Require the Departments to provide data and documents as well as explain business
results.
Attend meetings and making suggestions but not entitled to voting. Any disagreement
with BOD’s decisions is recommended to record in Meeting minutes and report to
shareholders.
Other rights as stipulated in the Charter and current law.
Board of Management: appointed by the BOD and have the following rights:
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Phu Nhuan Service Joint Stock Company Prospectus
Make decisions on issues related to day-to-day operations of the Company
Act on the decisions of the BOD, but the General Director has the right to refuse to
act on illegal decisions
Appoint and dismiss management persons unless appointed by the BOD
Decide the salary and bonus level as well as welfare policy for employees
Build development strategy and plans to use up the Company’s resource and capital
mobilization
Other rights and obligations as stated in the Charter.
Departments:
a) Sales Department:
Set up and implement business plans approved by the General Director
Research and develope distribution channel and pricing policy
Gather and analyze market data and competitor information
Implement Marketing and brand development plan
Provide sales service in domestic market and export
b) Administration Department:
Conduct administrative tasks
Implement and supervise personnel policy
Keep track of labor contracts and staff records
c) Financial planning Department:
Manage financial and accounting activities, set up financial plan
Prepare financial reports in accordance with the Accounting standard and tax
policies
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Phu Nhuan Service Joint Stock Company Prospectus
Make financial forecast and financial budget plan for the profitability of the
investment
d) Investment Management Department:
Implement and manage investment projects in accordance with the State
regulations
Make plan and organize auction to get the best price and quality of investment
projects.
Manage design and construction files for real estate projects.
Operate real estate business.
Affiliates:
a) Phuong Dong Electronic Technology Co., Ltd:
Address: A12 Phan Van Tri, Ward 7, Go Vap District, HCMC
Telephone: (84-8) 35 888 040
Chartered capital: VND5 billion
Business License No.4102062174 dated 2 June 2008 issued by Department of
Planning and Investment HCMC
Main fields of business: Production and trade of electrical and electronic products
MASECO’s capital contribution: 30% of chartered capital.
b) Phu Nhuan Economic Development Joint Stock Company:
Address: 421 Nguyen Kiem, Ward 9, Phu Nhuan District, HCMC
Telephone: (84-8) 62 920 907 Fax: (84-8) 62 920 908
Chartered capital: VND40 billion
Business License No.4103008660 dated 6 December 2007, issued by Department
of Planning and Investment HCMC
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Phu Nhuan Service Joint Stock Company Prospectus
Main fields of business: Trade on real estate, financial investment, interior design,
business management and consultancy and insurance agency.
MASECO’s capital contribution: 10% of chartered capital
SHAREHOLDERS’ MEETING
SUPERVISORY BOARD
GENERAL DIRECTOR
BOARD OF DIRECTORS
SALES DEPARTMENT
FINANCIAL PLANNING
DEPARTMENT
INVESTMENT MANAGEMENT DEPARTMENT
ADMINISTRATION DEPARTMENT
HANOI BRANCH GIALAI BRANCH MEMBERS
4. List of shareholders with 5% ownership, founding shareholders and shareholder
structure
4.1. List of shareholders with more than 5% ownership as at 30 September 2009:
No. Name Adress Shares held Value
(VND mil) Rate (%)
1 Nguyen Xuan Han
94 Dao Duy Anh, Ward 9, Phu Nhuan District, HCMC
627,000 6,270 10.45
2 Trinh Minh Ngoc
16 Phan Tay Ho, Ward 7, Phu Nhuan District, HCMC
555,000 5,550 9.25
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Phu Nhuan Service Joint Stock Company Prospectus
3 Truong Thi Thanh Tam
699 Cach Mang Thang 8, Ward 6, Tan Binh District, HCMC
366,000 3,660 6.10
4 Le Thien Hung 55A/3T Tran Quang Khai, Tan Dinh Ward, District 1, HCMC
370,040 3,700,4 6.17
5 Nguyen Xuan Han
No.7, Lot IX, Tan Quy Dong Residence, Tan Phong Ward, District 7, HCMC
311,000 3,110 5.18
Total 2,229,040 22,290.4 37.15
4.2. List of founding shareholders as at 30 September 2009:
No. Name Address Shares held
Value (VND mil)
Rate (%)
1 Nguyen Xuan Han
94 Dao Duy Anh, Ward 9, Phu Nhuan District, HCMC
627,000 6,270 10.45
2 Trinh Ngoc Minh
16 Phan Tay Ho, Ward 7, Phu Nhuan District, HCMC
555,000 5,550 9.25
3 Truong Thi Thanh Tam
699 Cach Mang Thang 8, Ward 6, Tan Binh District, HCMC
366,000 3,660 6.10
4 Le Thien Hung
55A/3T Tran Quang Khai, Tan Dinh Ward, District 1, HCMC
370,040 3,700.4 6.17
5 Do Huong Duong
34/32 Nguyen Thi Thap, Binh Thuan Ward, District 7, HCMC
276,000 2,760 4.60
6 Tran Thi Lua 5B Ba Gia, Ward 7, Tan Binh District, HCMC 275,400 2,754 4.59
7 Nguyen Tan Phi Khanh
145/13 Nguyen Dinh Chinh, Ward 11, Phu Nhuan District, HCMC
177,000 1,770 2.95
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Phu Nhuan Service Joint Stock Company Prospectus
Total 2,646,440 26,464.4 44.11
4.3. Shareholder structure as at 30 September 2009:
Shareholder Number of shareholders Shares held Rate (%)
1. Local shareholders 194 6,000,000 100
+ Institution: 2 118,360 1.97
+ Individual: 192 5,881,640 98.03
2. Foreign shareholders 0 0 0
+ Institution: 0 0 0
+ Individual: 0 0 0
Total 6,000,000 100
5. List of parent companies and subsidiaries of the Company: None
6. Business activities
6.1. Key products and services:
Major business activities of the Company include:
Manufacture and trade of electronics products
Manufacture and export of agricultural products
Restaurant, hotel and entertainment services.
Real estate business.
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Phu Nhuan Service Joint Stock Company Prospectus
6.2. Revenue and profit of each product/service line
a) Revenue of each product/service line:
Unit: VND million
2007 2008 9 mths 2009 Item
Value % Value % Value %
Electronic products 276,726 34.71 388,482 57.64 328,009 66.67
Agricultural products 505,560 63.42 270,124 40.08 177,058 34.37
Restaurant, hotel and entertainment services 10,978 1.37 12,090 1.79 8,014 1.55
Real estate business 2,127 0.26 2,072 0.30 623 0.12
Others 1,672 0.24 1,172 0.19 1,424 0.29
Total 797,063 100 673,940 100 515,128 100
Source: Head Office
b) Profits of each product/service line:
Unit: VND million
2007 2008 9 mths 2009 Item
Value % Value % Value % Electronic products 9,965 52.01 19,680 61.92 34,170 88.22
Agricultural products 4,205 21.95 4,435 13.95 700 1.80
Restaurant, hotel and entertainment services 2,640 13.78 3,062 9.63 1,893 4.88
Real estate business 1,499 7.82 2,781 8.75 544 1.40
Others 848 4.44 1,821 5.75 1,424 3.80
Total 19,157 100 31,779 100 38,732 100
Source: Head Office
6.3. Raw Materials
a) Source of raw materials:
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Phu Nhuan Service Joint Stock Company Prospectus
Raw materials for electronic products are separate electronic components or clusters,
electronic goods or the equipment covers in the form of removable or semi-finished
goods which are either domestically produced or imported.
Raw materials for agricultural products are agricultural goods procured directly from the
cultivators following purchasing process of the Company; or provided by other domestic
suppliers.
Lists of major raw material suppliers:
Electronic products:
No. Raw material Supplier
* Imported source
1 DVD components HK Electron Enterprise Co – HongKong
2 DVD, Karaoke components Kumyoung Co.LTD - Korea
3 Speaker components S-One & C.Corp - Korea
4 Amply components Suhyoung Electronic & Industries Inc – Korea
5 Microphone and speaker components Sonics Electronics Co.LTD - Korea
* Domestic source
1 Amply components Duong Long Co., Ltd
2 DVD components Sao Kim Electronics Joint stock Company Thai Gia Thuan Co., Ltd
3 Speaker components Phuong Dong Electronics Technology Co., Ltd
Agricultural products:
No. Raw material Supplier
1 Pepper Duc Hanh Trading Co., Ltd
2 Coffee beans Bac Ha Agricultural Trade and Services Co., Ltd
3 Coffee beans Khanh Thuy US. Production and Services Co., Ltd
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Phu Nhuan Service Joint Stock Company Prospectus
Source: Head Office
b) The stability of raw materials supplied:
The source of raw materials for electronic products is materials and semi-finished goods
provided regularly by reliable domestic suppliers or from import. Except the main
components to be imported from long-term suppliers, the others are produced
domestically by the Company’s affiliates in the form of separate components or semi-
finished goods to ensure the stability in both quality and quantity of raw materials.
Raw materials of agricultural products are from domestic source. According to national
statistics, Vietnam, the world’s No.2 coffee producer, has about 525,000 hectares of
coffee cultivated land and the annual coffee output is about 1 million tons. While
Vietnam remains the world’s top pepper exporter, around 49,000 hectares of land are
given to pepper production of about 100,000 tons annually, mainly in the South East and
Central Highland areas.
In particular, the agricultural processing plant of the Company is located at Chu Se
District, Gia Lai Province which provides the largest source of coffee and pepper for the
production of pure pepper (This area has 3,500 hectares of cultivated land and annual
pepper output of 15,000 tons while the production capacity of the plant is 5,000 tons per
year). Besides, as Vietnam is an agricultural country, the source for agricultural products
is plentiful provided by other domestic enterprises at competitive price and stable
quantities.
c) The influence of raw materials price on the revenue and profit:
The cost of raw materials for electronic goods accounts for 70% of the product cost;
therefore, the change in price of major raw materials will have a significant impact on the
profits of the Company. Previously 90% of major raw materials were imported so the
fluctuation of exchange rate also affected the product cost. To deal with this, the
Company has actively reduced the import of materials to below 50% of total materials
needed to reduce partially the impact of exchange rate fluctuation.
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Phu Nhuan Service Joint Stock Company Prospectus
The cost of major materials of agricultural products accounted for 90% of total product
cost so the price change will have large impact on the profits of this product line. To deal
with this risk, the Company has moved to production of high quality pepper products
which raw material cost just accounts for about 50%-60% of total product cost.
6.4. Production cost
The proportion of each production cost item to Net revenue of goods and services:
Unit: VND million
2007 2008 9 mths 2009
Item Value
% of Net
revenue Value
% of Net
revenue Value
% of Net
revenue
Cost of Goods sold 726,494 90.90 555,224 82.38 416,525 80.86
Selling cost 23,044 2.88 27,695 4.11 16,771 3.26
Management cost 19,208 2.40 36,664 5.44 32,423 6.29
Total 768,746 96.18 619,583 91.93 465,719 90.41
Source: Audited financial statements for 2007, 2008 and unaudited financial statement
for the period ended 30/9/2009
6.5. Market share
a) Market for electronic products:
MASECO products account for 40% of domestic market share of which 70% of total
products are of high-quality. Specifically, the consumption of MASECO products has
been increasing in recent years despite economic downturn which indicates the
Company’s ability to compete with rivals in the market.
In recent years, MASECO has also sped up the export of electronic products to meet the
demand of overseas Vietnamese community. The Company has gradually built up new
relationship and distribution channels in Australian and US markets to develop market
share. The market share of electronic products has been continuously increased as a result
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Phu Nhuan Service Joint Stock Company Prospectus
of constant development of distribution channels, advertising, promotion and warranty
services and prestige brand name in consumers’ mind.
b) Market for agricultural products:
Agricultural products have been faced with price fluctuation. To minimize price risk, the
Company has produced more refined products instead of raw products despite the
decrease of revenue of these products. A large proportion of agricultural products are
exported.
Major export markets for the Company’s products in 2007, 2008 and first half of 2009:
Coffee:
Unit: tons
2007 2008 9 mths 2009 Market
Value % Value % Value %
EU 11,000 68.88 2,400 70.58 1,378 59.83
US 3,500 21.92 700 20.58 216 9.38
Asia 1,469 9.20 300 8.84 708 30.79
Total 15,959 100 3,400 100 2,302 100
Source: Head Office
Pepper:
Unit: tons
2007 2008 9 mths 2009 Market
Value % Value % Value % EU 950 63.33 1,950 76.47 1,630 73.65
US 550 36.67 100 3.92 410 18.52
Asia - - 500 19.61 173 7.83
Total 1,500 100 2,550 100 2,213 100
Source: Head Office
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Phu Nhuan Service Joint Stock Company Prospectus
In 2009, the Company has planned to develop domestic market for “MASECO pepper
beans” through variety of distribution channels such as Co.op Mart, Intimex
supermarkets, Vissan retailing as well as high-class restaurants and households for the
supply of clean products which follow Food hygiene and safety standard.
6.6. Technology
MASECO has constantly renewed technology, improved management skills and product
quality in order to meet the demand of sofisticated consumers. The machinery system has been
updated regularly to enhance productivity.
Major production lines include:
4 DVD assembly lines with annual capacity of 200,000 units
1 amply assembly line with annual capacity of 40,000 units
2 speaker assembly lines with annual capacity of 30,000 units.
1 record room
5 music and midi production rooms
1 closed production line of pepper with annual capacity of 5,000 tons
1 production line of grind pepper and product packaging line with annual capacity of
2 million units.
6.7. Product research and development
The Company always applies modern technology in the production of audio and
electronic equipments. The Company currently has 40 types of different audio electronic
products for different market segments, serving the needs for different consumer targets.
The Company has also built a Multimedia center to enhance the quality of music CDs,
karaoke DVDs and digital audio products.
For agricultural products, the Company has been concentrated more on production of
refined products instead of raw products. Besides the investment in production line and
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Phu Nhuan Service Joint Stock Company Prospectus
packaging of grind peppers, the Company is going to launch new product lines in small
package targeting households, restaurants and industrial producers.
6.8. Product quality inspection
a) Quality management system:
MASECO has always paid special attention to the product quality management. The
Company has currently implemented the following quality management system:
Quality management system ISO 9001-2008.
Hazard Analysis and Critial Control Points
Good Manufacturing Practice
b) Quality inspection Division:
For electronic products: the quality of electronic components and semi-finished goods
is checked before put into production, in each stage and whole process before taken
out of the factory.
For agricultural products: input materials’ quality has to follow the purchasing policy
of the Company. The production process and warehouse are closely supervised under
quality inspection system of the Company.
For restaurant services: the source of all food ingredients as well as food processing
are inspected carefully to ensure the compliance of Food Hygiene and Safety
standard.
6.9. Marketing strategy
The Company has set up a Marketing department which role is to do market research and
analysis and product design for the enhancement of the Company’s images. Advertising
campaign of the Company includes:
Organizing events, sponsoring football leagues, karaoke competition and social
activities.
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Phu Nhuan Service Joint Stock Company Prospectus
Attending Vietnam High-quality products and domestic and international Trade fairs.
Television or radio advertisement
Panel and sign advetisement
Besides advertising activities, the Company also builds distribution channels and
warranty agencies as followed:
Thousands of shops nationwide distributing products from the Head Office and
branches or Level I agency to shops with different reward systems.
Customer service and warranty system have been built up in most of main cities and
provinces nationwide to meet the demand of a large segment of customers.
6.10. Brandings and Trademarks
Maseco
Maseco pepper
Karaoke Online
Arirang
Maseco Midivision KaraOke
7. Business results in recent years
7.1. Summary of business results
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Phu Nhuan Service Joint Stock Company Prospectus
Unit: VND million
Item 2007 2008 % change 2008/2007
9 mths 2009
Total assets 246,452 299,567 21.55% 332,400
Net revenue 797,063 673,940 (15.44%) 515,128
Operating profit 18,309 29,957 63.62% 38,505
Other profits 848 1,821 114.74% 227
Before-tax profit 19,157 31,779 65.88% 38,732
Net profit 15,326 24,651 60.84% 33,314
Dividend rate 43.06% 53.54% 24.33% -
Source: Audited financial statementsfor 2007, 2008 and unaudited financial statement
for the period ended 30/9/2009
7.2. Impact on business performance in 2008
In 2008, the net revenue decreased 15.44% compared to 2007, mainly the decrease in
export revenue due to the change from raw agricultural to refined products. The purpose
of this new export structure was to limit the risk of price fluctuation of agricultural
products.
On the other hand, the operating profit in 2008 increased 65.15% compared to 2007
despite the decrease in net revenue, mainly due to good control in product cost, especially
the proportion of the cost of goods sold to net revenue declined from 90.9% in 2007 to
82.45% in 2008.
8. Position of the Company compared with other corporations in the industry
8.1. Position of MASECO in the industry
Although MASECO has had to face with the competition from domestic and foreign
rivals in recent years, the Company has always made efforts to maintain their position on
the market with a stable annual revenue growth rate of 30%. The Company’s brand has
been highly valued with the following awards:
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Phu Nhuan Service Joint Stock Company Prospectus
In 2008, Arirang DVD products had the highest market share in Vietnam according to
the analysis of GFK Corporation.
Being in the TOP 500 of biggest private enterprises in Vietnam voted by VNR500
Program of Vietnamnet.
Certificate of Vietnamese high quality goods voted by consumers (organized by
Saigon Marketing News) and TOP TEN of Vietnamese Brand in 2008 by Association
of Science and Technology of Vietnam.
“Prestigious Export Enterprise” Award 2004-2008 by Ministry of Trade
Award of sustainable development 2007-2008 awarded by Ministry of Industry and
Commerce.
a) Strengths:
MASECO is a friendly and prestigious brand in the consumers’ mind. There are not a
lot of comparable competitors in the market so it is easy for the Company to maintain
their market share from time to time.
MASECO has a variety of good-designed products which focus on different
consumer segments.
MASECO constantly implements modern technology to catch up with the market trend.
MASECO products have high quality following the global standard system.
Ideal production process of electronic products, music CDs and digital audio products; skillful
and experienced technicial staff.
Build up high-quality closed production plants of pepper products for the production of
high quality products following Food Hygiene and Safety standard of Vietnam and the
world.
Plants are located at ideal position which facilitates business operation; in particular,
the pepper processing plant is located at area of high qualiy and plentiful material
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Phu Nhuan Service Joint Stock Company Prospectus
sources, and the assembly production plant of electronic products is located at
HCMC, a center of economic activities and skillful employees.
Fully comply with business regulations
b) Weaknesses and Threats
The seasonality of raw materials for agricultural products has an important impact on
the export, therefore, the Company needs to have a purchasing plan for raw materials
to meet the demand for both export and reserve purposes.
Technical and trade barriers of import countries affect the Company’s export plans.
The main source of raw materials for electronic products is imported so the
fluctuation of exchange rate has an impact on product pricing.
The violation of industrial intellectual property and fake electronic products in the
market is a threat for MASECO business as the Company always complies with
regulations.
c) Opportunities
Vietnam with a stable economic growh rate and 85 million of population creates a big
and potential market for developing enterprises.
The investment and development policies of the Company comply with the State
development policy.
The consumers of agricultural products tend to be more concerned about the food
hygiene and safety standard in recent years while the Company’s products fully
comply with the standard.
9. Labor policy
9.1. Labor structure
The total number of staff and labour structure as at 30 September 2009:
Classification Quantity %
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Phu Nhuan Service Joint Stock Company Prospectus
Education level - Postgraduate and Graduate - Junior and Intermediate college - Technical staff - Unskilled staff
50 82 17 108
19.5 31.9 6.6 42
Job title
- Sales and Management staff - Technical staff - Workers and unskilled staff
82 49 126
31.9 19.1 49
Labor contracts
- Unknown duration contract - Fixed-term contract - Temporary contract
05 206 46
1.9 80.1 18
Total 257 100
Source: Head Office
9.2. Labor policy
Recognizing the role of human in the success of the business, the Company has always
paid much attention to the labor force especially the well-educated and skillful staff
through salary, bonus and welfare policy. The staff income has been gradually increasing
with an average annual growth rate of 25% in previous years. The Company also fully
complies with Labor regulations regarding Social and Health Insurance, working time,
holidays and annual leave.
Support and give staff opportunities to attend training courses for the enhancement of technical
skills and legal knowledge.
Pay attention to the welfare of staff by organizing outdoor trips, and help to enhance
their living standard.
Apply employee stock option plan to create motivation and long-term commitment of
staff.
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Phu Nhuan Service Joint Stock Company Prospectus
10. Dividend policy
The Dividend policy based on the Company’s Charter approved by the Shareholders’
Meeting dated 24 April 2008:
The Company is allowed to pay dividend to shareholders only if the Company makes
profit after paying taxes and other obligations as stipulated by the Law.
The BOD is entitled to pay interim dividend if the payment is in accordance with the
profitability of the business.
Dividend payment in 2007 and 2008 is as followed:
Item Unit 2007 2008
Chartered capital VND million 30,000 60,000
No. of shares outstanding shares 3,000,000 6,000,000
Dividend rate % 22 22
Dividend paid VND million 6,600 13,200
Source: Audited financial statements for 2007, 2008 and unaudited financial statement
for the period ended 30/9/2009
11. Financial operation
11.1. Fundamental financial ratios:
The financial year starts from 1 January and ends at 31 December annually. Items in
Financial Statements of the Company are presented in VND in accordance with the
Accounting standard of Vietnam.
a) Depreciation and amotization of fixed assets:
From 2003 backward, the Company applied the Depreciation method based on the
Decision No.166/1999/QD-BTC dated 30 December 1999 of the Ministry of Finance.
Since 2004, the Company has been using straight-line method over estimated useful life
of the assets in accordance with the Decision No. 206/2003/QD/BTC dated 12 December
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Phu Nhuan Service Joint Stock Company Prospectus
2003 of the Ministry of Finance regarding the management, use and depreciation of fixed
assets.
- Premises and buildings: 5-30 years
- Plants and machineries: 7-10 years
- Motor vehicles: 10 years
- Office equipments: 5 years
- Other fixed assets: 3-4 years
- Intangible fixed assets (land use rights): None
b) Average salary: In 9 months of 2009, the average monthly salary of employees is
VND4,500,000/staff
c) Bad debts: The Company has no bad debts as at 30 September 2009.
d) Payables: The Company fully complies with the VAT tax and enterprise income tax
regulations of the State.
e) Provisions in compliance with regulations: The Company creates provisions in
accordance with the Charter and current regulations as followed:
Provision for Investment and Development: 10%-15% of net profit
Compulsory reserve fund: 5% of net profit to be cummulated until the fund accounts
for 10% of the chartered capital.
Welfare and reward fund: 15% of net profit.
Provisions in 2007 and 2008:
Unit: VND million
Item 2007 2008
Provision for financing activities 542 766
Provision for Investment and development 3,572 4,161
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Phu Nhuan Service Joint Stock Company Prospectus
Welfare and reward fund 1,626 2,298
Total 5,740 7,225
Source: Audited financial statements for 2007and 2008
f) Bank loan:
Bank loan balances as at 31 December 2008:
Short-term loans: VND 166,482,219,185
Long-term loans: VND 4,088,963,980
Bank loan balances as at 30 Sep 2009:
Short-term loans: VND 166,567,921,120
Long-term loans: VND 7,502,963,989
g) Account receivables:
Unit: VND million
Item 31/12/2007 31/12/2008 30/09/2009
Account receivables from customers 31,605 21,153 25,844
Prepayment for suppliers 32,327 25,574 45,729
Account receivables on construction in progress - - 231
Other receivables 17,262 14,670 14,493
Provision for bad receivables (2,000) (6,400) (6,400)
Total 79,196 54,998 79,897
Source: Audited financial statements for 2007, 2008 and unaudited financial
statement for the period ended 30/9/2009
h) Account payables:
Unit: VND million
Item 31/12/2007 31/12/2008 30/09/2009
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Phu Nhuan Service Joint Stock Company Prospectus
Short-term liabilities 160,079 204,237 209,406- Short-term debts 136,005 166,482 166,568
- Payables to suppliers 10,227 12,485 5,654
- Deferred revenue 1,023 576 137
- Taxes and payables to State budget 2,568 3,496 6,387
- Payables to employees 5,227 16,395 24,400
- Accrual expenses 4,744 4,260 5,679
- Other payables 282 540 579
Long-term liabilities 2,309 4,446 7,811
Total 162,389 208,684 217,215
Source: Audited financial statements for 2007, 2008 and unaudited financial
statement for the period ended 30/9/2009
11.2. Major financial ratios:
Item 31/12/2007 31/12/2008 30/09/2009
1. Liquidity
Current ratio 1.15 1.12 1.21
Quick ratio 0.83 0.42 0.44
2. Financial leverage
Total debts/Total assets 65.89% 69.66% 65.35%
Total debts/Equity 1.93 2.29 188%
3. Efficiency
Total Asset turnover 3.23 2.25 1.55
Inventory turnover 14.02 5.73 2.73
4. Profitability
Net profit /Net revenue 1.92% 3.66% 6.47%
Net profit /Equity 18.91% 28.34% 28.92%
Net profit /Paid-in capital 51.08% 41.08% 55.52%
Net profit /Total assets 6.21% 8.22% 10.02%
Operating profit/Net revenue 2.29% 4.45% 7.47%
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Phu Nhuan Service Joint Stock Company Prospectus
5. Share-related ratio (Face value: VND 10,000/share)
Average shares outstanding 3,000,000 3,591,780 6,000,000
Earning per share (VND/share) 6,699 6,863 5,552
Book value per share (VND/share) 27,019 24,216 18,015
Source: Audited financial statements for 2007, 2008 and unaudited financial statement for
the period ended 30/9/2009
12. Board of Directors, Board of Management, Supervisory Board, Chief Accountant
12.1. Board of Directors:
a) Chairwoman – Ms Truong Thi Thanh Tam
Date of birth :15/08/1947
ID number :020116692 issued by HCMC Police authorities on
03/3/2003
Place of birth : Dong Thap
Nationality : Vietnamese
Ethnic : Kinh
Permanent address : 54/1/8A Bach Dang, Ward 2, Tan Binh District, HCMC
Office telephone : (84-8) 38 444 861
Education :12/12
Qualification : Intermediary school
Employment history
1983-2009 : Work at MASECO
Number of shares held : 366,000 shares
Violation of law : None
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Phu Nhuan Service Joint Stock Company Prospectus
Rights not in the Company’s interests: None
b) Vice Chairman – Mr. Nguyen Xuan Han
Date of birth : 11/8/1957
ID number : 020111503 issued by HCMC Police authorities on 30/12/2002
Place of birth : Da Nang
Nationality : Vietnamese
Ethnic : Kinh
Permanent address : 94 Dao Duy Anh, Ward 9 , Phu Nhuan District, HCMC
Office telephone : (84-8) 38 444 861
Education : 12/12
Qualification : Bachelor of Law
Employment history
1983-2009 : Work at MASECO
Number of shares held : 627,000 shares
Current position : General Director of MASECO
Violation of law : None
Rights not in the Company’s interests : None
c) Member – Mr. Do Huong Duong
Date of birth : 27/02/1958
ID number :021722032 issued by HCMC Police authorities on 29/6/2007
Place of birth : HCMC
Nationality : Vietnamese
Ethnic : Kinh
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Phu Nhuan Service Joint Stock Company Prospectus
Permanent : 34/32 Nguyen Thi Thap, Binh Thuan Ward, District 7, HCMC
Telephone number : (84-8) 38 444 861
Education : 12/12
Qualification : Bachelor of Law
Employment history
1983-2009 : Work at MASECO
Number of shares held : 276,000 shares
Current position : Deputy General Director
Violation of law : None
Rights not in the Company’s interests : None
d) Member – Mr. Trinh Ngoc Minh
Date of birth : 24/09/1962
ID number :020649447 issued by HCMC Policy authorities on 08/8/2008
Place of birth : HCMC
Nationality : Vietnamese
Ethnic : Kinh
Permanent Address :16 Phan Tay Ho, Ward 7, Phu Nhuan District, HCMC
Office Telephone : (84-8) 38 444 861
Education :12/12
Qualification : Engineer of Electronics
Employment History
1986-2009 : Work at MASECO
Number of shares held : 555,000 shares
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Phu Nhuan Service Joint Stock Company Prospectus
Current position : Deputy General Director
Violation of law : None
Rights not in the Company’s interests : None
e) Member – Mr. Nguyen Tan Phi Khanh
Date of birth : 02/5/1967
ID No. :021719134 issued by HCMC Policy authorities on 29/6/2007
Place of birth : HCMC
Nationality : Vietnamese
Ethnic : Kinh
Permanent Address :145/13 Nguyen Dinh Chinh, Ward 11, Phu Nhuan District,
HCMC
Office telephone : 38 444 861
Education :12/12
Qualification : Bachelor of Law
Employment History
1989-2009 : Work at MASECO
Number of shares held : 177,000 shares
Current position : Manager of Administration Department
Violation of law : None
Rights not in the Company’s interests : None
f) Member – Mr. Le Thien Hung
Date of birth : 05/08/1969
ID No. :280713693 isssued by Song Be Policy authorities on 15/6/1995
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Phu Nhuan Service Joint Stock Company Prospectus
Place of birth : Hue
Nationality : Vietnamese
Ethnic : Kinh
Permanent Address : 55A Floor 2, Tran Quang Khai, District 1, HCMC
Office telephone : (84-8) 38 440 159
Education : 12./12
Qualification : Engineer of Electronics
Employment History
1994-2009 : Work at MASECO
Number of shares held : 370,040 shares
Current position : Manager of Electronic Service Center
Violation of law : None
Rights not in the Company’s interests : None
g) Member – Ms. Tran Thi Lua
Date of birth : 08/08/1966
ID No. :024111245 issued by HCMC Policy authorities on 07/4/2003
Place of birth : HCMC
Nationality : Vietnamese
Ethnic : Kinh
Permanent Address : 5B Ba Gia, Ward 7, Tan Binh District, HCMC
Office telephone : (84-8) 38 444 861
Education : 12/12
Qualification : Bachelor of Economics
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Phu Nhuan Service Joint Stock Company Prospectus
Employment History
1988-2009 : Work at MASECO
Number of shares held : 275,400 shares
Current position : Chief Accountant
Violation of law : None
Rights not in the Company’s interests : None
12.2. Supervisory Board:
a) Director – Ms. Nguyen Thi Lan
Date of birth : 16/7/1968
ID No. :021875329 issued by HCMC Policy authorities on 08/8/2008
Place of birth : Ha Tay
Nationality : Vietnamese
Ethnic : Kinh
Permanent Address : D9 Lam Son Quarter, Nguyen Oanh, Go Vap District, HCMC
Office telephone : (84-8) 38 441 917
Education : 12/12
Qualification : Bachelor of Economics
Employment History
1988-2009 : Work at MASECO
Number of shares held : 206,500 shares
Current position : Deputy Director of Hoa Mai Hotel
Violation of law : None
Rights not in the Company’s interests : None
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Phu Nhuan Service Joint Stock Company Prospectus
b) Member – Ms Nguyen Thi Thanh Tung
Date of birth : 19/10/1964
ID No. :021713307 issued by HCMC Policy authorities on 28/6/2007
Place of birth : HCMC
Nationality : Vietnamese
Ethnic : Kinh
Permanent Address : 321/4/1 Phan Dinh Phung, Phu Nhuan District, HCMC
Office telephone : (84-8) 38 440 159
Education : 12/12
Qualification : Bachelor of Economics
Employment History
1985-2009 : Work at MASECO
Number of shares held : 72,460 shares
Current position : Deputy General Director of Electronic Service Center
Violation of law : None
Rights not in the Company’s interests : None
c) Member - Mr Le Thi Hien Dieu
Date of birth : 11/10/1964
ID No. :021877362 issued by HCMC Policy authorities on 27/12/2008
Place of birth : HCMC
Nationality : Vietnamese
Ethnic : Kinh
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Phu Nhuan Service Joint Stock Company Prospectus
Permanent Address : D2 Nguyen Van Troi Quarter, Ward 17, Phu Nhuan District,
HCMC
Office telephone : (84-8) 38 444 861
Education : 12/12
Qualification : College of Accounting
Employment History
1984-2009 : Work at MASECO
Number of shares held : 21,800 shares
Current position : Deputy Manager of Financial Planning Department
Violation of law : None
Rights not in the Company’s interests : None
12.3. Board of Management
a) General Director – Mr. Nguyen Xuan Han: same in Section 14.1 (b) of BOD.
b) Deputy General Director – Mr. Do Huong Duong: same in Section 14.1 (c) of
BOD.
c) Deputy General Director – Mr. Trinh Ngoc Minh: same in Section 14.1 (d) of
BOD.
13. Fixed Assets
Fixed assets balance as at 30 September 2009:
Unit: VND million
No. Item Beginning Value
Accumulated depreciation
Value at end the of
year
Tangible fixed assets 1 Premises and buildings 23,527 5,082 18,445
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Phu Nhuan Service Joint Stock Company Prospectus
2 Plants and machineries 7,013 3,190 3,823
3 Motor vehicles 9,266 2,873 6,392
Total 39,806 11,146 28,660
Source: Unaudited financial statement for the period ended 30/9/2009
14. Revenue and dividend plan for the period 2009-2010
Unit: VND million
2008 2009 2010
Item Value Value
% change compared
to 2008 Value
% change compared
to 2009
Total Assets 299,567 350,000 + 16.8% 600,000 + 71.4%
Chartered capital 60,000 115,500 + 92.5% 150,000 + 29.8%
Net revenue 673,940 700,000 + 3.9% 800,000 +14.3%
Operating profit 29,957 35,000 + 16.8% 45,000 + 28.6%
Other profit 1,821 2,000 + 9.8% 3,000 + 50%
Before-tax profit 31,779 37,000 + 16.4% 48,000 + 34.37%
Net profit 24,651 31,800 + 29% 38,400 + 20.7%
Net profit/Net revenue 3.66% 4.5% + 7.4% 4.8% + 6.6%
Net profit/Chartered capital 41% 43% - 25.6% -
Dividend/Net profit 53.54% 51% - 3.6% 78% + 53 %
Dividend rate (%) 22% 22% - 20% -
15. Consulting Organization’s assessment of MASECO’s revenue and dividend plan
EPS has collected data and conducted careful and reasonable studies on the business
operations of MASECO to assess the feasibility of the business plan for the next two
years. In 2008 and first half of 2009, although Vietnam and the world’s economy fell into
financial crisis and economic recession, MASECO with own business strategy and
position in the industry was still able to overcome difficulties and maintain a significant
profit growth rate. Moreover, the Company’s operation has been diversified with a
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Phu Nhuan Service Joint Stock Company Prospectus
variety of product and service lines to be able to maintain a stable revenue level and
reduce business risks especially in an unfavorable condition. Specifically, the revenue
and profit from electronic products which account for more than 50% of total revenue
and profit of the Company tend to increase gradually when the Company plans to limit
the use of imported raw materials as well as increase export. For agricultural products,
the Company has focused on the production of refined products and penetrates domestic
market to increase revenue and decrease cost of goods sold. In addition, with further
investment in variety of real estate projects while this sector accounts for an increasing
proportion in the profit structure of the Company, this would be an additional source of
profit for the Company in a near future.
The Company has a competitive position in the market with modern technology
application in production, constant research and development activities, and special
concern of food hygeine standard, the ability to control cost, branding development and
an experienced Management team who is able to forecast and deal with business risks.
With these strengths, EPS believes that the Company’s ability to achieve the revenue and
profit plan is feasible if there is no significant crisis affect the operation of the Company.
The dividend plan is to maintain the dividend rate for shareholders as well as
reinvestment purposes.
This assessment is for reference only and does not guarantee the value of the share.
16. Information about commitments that the company has not completed: None
17. Information about disputes related to the company that may affect the share price:
None
V. SHARE OFFERING
1. Stock: Common share of Phu Nhuan Services Joint stock Company
2. Face value: VND10,000/per share
3. Number of shares offered: 9,000,000 shares, in which:
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Phu Nhuan Service Joint Stock Company Prospectus
Share offer to existing shareholders: 5,000,000 shares which account for 55.55% of
total number of shares offered at a pro rata of 6:5 (At the date of closing shareholder
list, each existing shareholder is entitled to buy 5 shares for every 6 shares of their
current holding. The number of shares offered for each shareholder will be rounded to
the nearest ten). The distribution of remaining shares to others will be decided by the
BOD.
Share offer to current employees who sign the labor contract with the Company:
550,000 shares which account for 6.11% of total number of shares offered. The BOD
decides the criteria, restrictions and the list of staff as well as the number of shares for
each staff.
Private placement with strategic investors: 3,450,000 shares which account for
38.34% of total shares offered. The BOD decides the list of individual and
institutional strategic investors who have one or more of following criteria: ability to
enhance management quality, market development, being regular partners of the
Company and financial support for upcoming projects.
4. Expected offer price and pricing method:
Existing shareholders: VND20,000/share. This price is based on the Company’s share
price on OTC market during the nearest 3 months and can be adjusted by the BOD
but not lower than the book value as at end of nearest quarter.
Employees: VND25,000/share. This price is based on the Company’s share price on
OTC market during the nearest 3 months and can be adjusted by the Board of
Directors but not lower than the book value as at end of nearest quarter.
Strategic investors: the price is decided later based on the negotiation between the
BOD and each investor but can not be lower than the price offered to existing
shareholders.
Book value of MASECO shares is calculated based on figures on audited financial
statement for the period ended 30/9/2009:
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Phu Nhuan Service Joint Stock Company Prospectus
No. Item Unit Value 1 Equities VND mil 115,185
2 Bonus and welfare fund VND mil 7,096
3 Shares outstanding shares 6,000,000
4 Treasury stock shares -
5 Book value [(1)-(2)]/[(3)-(4)] VND 18,015
Source: Unaudited financial statement for the period ended 30/9/2009
5. Share placing method: conducted by the Company
6. Placing schedule:
6.1. Stage 1 - Offer to existing shareholders:
Step 1- Announcement: In 7 days from the date receving the License, MASECO
anncounces the offer on public media in accordance with the Securities law, and closes
shareholders list (10 days from the announcement date).
Step 2 – Make the list of shareholders entitled to share offer
Step 3 – Announce the rights for share offer to each of shareholder in 3 days from the
date of closing the shareholder list.
Step 4 – Shareholders register to buy shares and make payment at the Head Office of the
Company in 22 days from the date of announcement of the rights
Step 5 – The BOD makes decision on the distribution of remaining shares.
Step 6 – The Company finalizes the results and reports to the SSC in 10 days from the
date of closing the offer. Issue the ownership certificate for each shareholder in 30 days
from the date of closing the offer.
6.2. Stage 2 - Share offer to employees and strategic investors:
1. Offer to employees:
Step 1 – Announcement
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Phu Nhuan Service Joint Stock Company Prospectus
Step 2 – The BOD decides and announces the list of staff and number of shares each staff is
entitled to buy.
Step 3 – Employees register to buy shares and make payment in the Company’s Head
Office in 20 days from the annoucement date. The rights can not be transferred.
Step 4 – Finalize, report the results and issue ownership certificate.
2. Offer to strategic investors:
Step 1 – Annoucement
Step 2 – Offer letter is sent to each strategic investor. Strategic investors register to buy
shares.
Step 3 – The BOD meets to decide the list of investors as well as the quantity and share
price
Step 4 – MASECO and investors sign the contracts and make payment.
Step 5 – Finalize and report the results to the SSC in 10 days from the date of closing the
offer. Issue ownership certificate in 30 days after the date of closing offer.
7. Limit on foreign shareholding
The Charter of the Company does not set a limit on foreign shareholding. After the
listing, the limit depends on regulations.
According to the Decision No. 55/2009/QĐ-TTg dated 15 April 2009 of the Prime
Minister, a public company will not have over 49% of foreign ownership and
MASECO must comply with this regulation.
8. Related tax
8.1. Corporate Income tax:
The Company is entitled to have a corporate income tax of 20% over the taxable
operating profit from 1 October 2001 to 31 December 2011. From 1 Jan to 31 December
2009, the Company has a deduction of 30% on corporate income tax rate.
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Phu Nhuan Service Joint Stock Company Prospectus
8.2. Tax from Securities Investment:
On 19 June 2009, the National Assembly approved the Decision of tax exemption for
personal income on capital investment and fund transfer (including share transfer) from
January to June 2009 and for the rest of 2009. All share trading activities will receive tax
incentive in 2009.
9. Bank account for payment:
Account number: 025 137 100 2467 at Vietcombank – Binh Tay Branch
VI. THE PURPOSE OF SHARE OFFERING
1. The purpose:
The share offer is to mobilize capital for the projects approved by Shareholders’ Meeting
in 2008 and 2009 as followed:
Arirang Office building: 131 Tran Huy Lieu, Phu Nhuan District, HCMC
MASECO I Office building for lease: 149-151 Nguyen Van Troi, Phu Nhuan District,
HCMC
Hotel: 157 Phan Dang Luu, Phu Nhuan District, HCMC
Production plants at Hiep Phuoc Industrial Zone (HCMC) and Dat Cuoc Industrial
Zone (Binh Duong)
High-rise Residential apartment building: 108 Le Loi, Ward 4, Go Vap District,
HCMC
Other projects in business plan approved by the Shareholders’ Meeting and the BOD.
Increase working capital
Basically all of the construction projects are conducted on the area which land-use rights
belong to the Company. All projects fulfill the development plan of the Company as well
as the market demand and the Government policy on modern urban infrustructure. Page 56
Phu Nhuan Service Joint Stock Company Prospectus
2. Feasibility plan
2.1. Arirang Office building: 131 Tran Huy Lieu, Phu Nhuan District, HCMC
Project originator: Van Xuan Construction Design and Environment Co., Ltd
Investor: MASECO
Phu Nhuan District is considered one of central districts of economic, international
trade and travel activities. The demand for office space has been increasing in recent
years and is expected to increase at a higher rate with the economic recovery in the
end of 2010-2011. Therefore, the investment in this project is not only profitable but
also meets the demand of the Company occupying 30% of total area for office space.
The construction license has been issued.
Expected time to finish: August 2010.
Total investment: VND32 billion
Total construction area: 3,000 m² (8-floor office building).
2.2. MASECO I Office building for lease: 149-151 Nguyen Van Troi, Phu Nhuan
District, HCMC
Project originator: Apave of Vietnam and South East Asia
Investor: MASECO
This office building is built on Nguyen Van Troi Street in accordance with the urban
design plan to meet the demand for more office spaces of corporations, financial
institutions and banks.
The construction license has been issued and will be in construcion soon.
Area: 720 m² (45m height, including 2 basements, 1 ground, 1 middle and 11 floors)
Construction area: 7,000 m²
Total investment: VND65 billion from share issue capital and bank borrowing.
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Phu Nhuan Service Joint Stock Company Prospectus
Time put into operation: October 2011
Time to break-even: 10 years
2.3. Hotel: 157 Phan Dang Luu, Phu Nhuan District, HCMC
Investor: MASECO
This project was originally office building and finally turned into hotel construction to
meet the demand for 3-4 star hotels of both domestic and foreign visitors.
3-4 star hotel, 60-70 bedrooms and restaurants, entertainment areas.
Area: 590 m² (45m height, including 2 basements, 1 ground, 1 middle and 11 floors).
Construction area: 5,000 m²
Total investment: VND80 billion from share issue capital and bank borrowing.
Time to start construction: 2010
Time put into operation: 2012
2.4. Production plants at Dat Cuoc Industrial Zone (Binh Duong Province) and
Hiep Phuoc Industrial Zone (HCMC)
Investor: MASECO
The Company plans to move existing plants in central area to industrial zone for the
production development.
1. Agricultural plant and warehouse at Dat Cuoc Industrial Zone, Binh Duong province:
Long-term lease contract (49 years) for the land with full payment
Total area: 19,000 m²
2. Electronic plant and warehouse at Hiep Phuoc Industrial Zone, HCMC
Long-term lease contract (49 years) for the land with full payment
Total area: 12,000 m²
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Phu Nhuan Service Joint Stock Company Prospectus
All documents for these two projects have been prepared, land rental has been paid and
the certificate of land use right has been issued.
Total construction area: 20,000 m²
Total investment: VND50 billion from share offering and bank borrowings.
Time to start construction: 2010
Time put into operation: beginning of 2011
2.5. High-rise Residential apartment building: 108 Le Loi, Ward 4, Go Vap
District, HCMC
Investor: MASECO
The land use right with the value of VND67 billion has been transferred to the Company.
The plan for this project has been granted by HCMC Department of Architecture
Planning in the Document No. 2340/SQHKT-QHKV2 dated 1 July 2008.
Total area: 2,087 m² (45m height, including 2 basements, 1 ground, 1 middle and 11
floors)
Construction area: 12,000 m²
Number of apartment units: 100 units + 2,000m of business area
Total investment: VND150 billion
Intial capital need: VND100 billion from share offering and bank borrowings
Expected selling price: VND20 million/m² for apartment unit, VND15 million/m² for
business area
Expected revenue: VND210 billion
After-tax profit: VND60 billion
Time to start construction: end of 2010
Time put into operation: 2012
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Phu Nhuan Service Joint Stock Company Prospectus
2.6. Other projects:
The current lease contracts of 6 individual houses have been transferred to the
ownership of the Company for a more convenient future use. The estimated
investment is VND20 billion.
The Company plans to buy houses to build up office spaces for Hanoi, Danang and
Cantho branches. These three branches will be distribution centers for the future
business development of the Company in the future. Total investment for this projects
is VND30 billion
- Hanoi branch : VND16 billion
- Danang branch: VND7 billion
- Cantho branch: VND7 billion
VII. ACTION PLAN FOR THE USE OF FUND FROM SHARE OFFERING
1. Total capital from the issue
No Shareholder No. of shares offer Total capital (VND mil)
1 Existing shareholders 5,000,000 100,000
2 Employees 550,000 13,750
3 Strategic shareholders 3,450,000 100,350
Total 9,000,000 214,100
2. Action plan
Unit: VND million
Fund from issuance No. Project Total fund
Stage 1 Stage 2
1 Arirang Office building 131 Tran Huy Lieu, Phu Nhuan District, HCMC
32,000 12,000
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Phu Nhuan Service Joint Stock Company Prospectus
2 Maseco I Office building for lease 149-151 Nguyen Van Troi, Phu Nhuan District, HCMC
65,000 20,000
3 Hotel 157 Phan Dang Luu, Phu Nhuan District, HCMC
80,000 24,000
4 Office, production plant and warehouse of electronic products at Hiep Phuoc Industrial Zone, HCMC
35,000 14,000
5 Production plant and warehouse of agricultural products at Dat Cuoc Industrial Zone, Binh Duong
15,000 7,000
6 High-rise residential apartment 108 Le Loi, Go Vap District, HCMC
100,000 40,000
7 Transfer the lease of 6 individual houses to ownership of the Company 20,000 10,000
8 Purchase properties for branches in other big cities 30,000 15,000
9 Working capital 72,000 5,000 67,000
Tổng cộng 449,000 100,000 114,000Total capital need for projects are VND449 billion in which borrowings account for 50%-
70% of total capital and the rest is capital from share issue. The remaining unused capital
is contributed to working capital.
VIII. RELATED PARTIES TO THE SHARE OFFERING PLAN
1. Consulting organization: Empower Securities Joint Stock Company (EPS)
Head office: Floor 1&2 Chuong Duong ACIC Building
225 Ben Chuong Duong, District 1, HCMC
Telephone: (84-8) 38 386 068 Fax: (84-8) 38 386 896
Hanoi Branch: Floor 3, 249 Tran Dang Ninh, Cau Giay District, Hanoi
Telephone: (84-4) 39 744 448 Fax: (84-4) 39 744 501
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Phu Nhuan Service Joint Stock Company Prospectus
2. Auditing organization: Auditing and Informatic Service Co., Ltd HCMC
Head office: 142 Nguyen Thi Minh Khai, District 3, HCMC
Telephone: (84-8) 39 305 163 Fax: (84-8) 39 304 281
IX. APPENDICES
1. The Charter of MASECO
2. Copy of Business Registration Certificate of MASECO
3. Audited financial statements for the year 2007 and 2008 and unaudited financial
statements for the period ended at 30 September 2009.
HCMC 26 December 2009
REPRESENTATIVE of MASECO
CHAIRWOMAN
Truong Thi Thanh Tam
General Director
Nguyen Xuan Han
Chief Accountant
Tran Thi Lua
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