VinaLand Limited (“VNL” or “the Company”) is a closed-end investment company incorporated in the Cayman Islands. The Company is currently in a cash return period.
During the Cash Return Period, the Company will not make any new investments, unless additional funds are required for existing projects within the Company’s property portfolio, with the intention of maximising that particular asset’s value and which will assist in its eventual realisation for the highest possible value.
VNL is managed by VinaCapital Investment Management Ltd (“VCIM” or the “Investment Manager”), a Cayman Islands company. VCIM was established in 2008 and manages three listed and several unlisted investment companies. More information about VinaCapital and its management team is available here.
The Company will adhere to the following investment policies and restrictions:
Type of investment:
The Company is permitted to engage in all forms of property investment and property development as allowed under the laws of each jurisdiction in which it operates, utilising instruments and structures that may be suitable to allow participation in selected investment opportunities. These investments will be made directly or through investee companies (which are special purpose vehicles established specifically for each project) or by way of joint venture partnerships with other reputable developers. During the Cash Return Period, the Company will not make any new investments, unless additional funds are required for existing projects within the Company’s property portfolio.
At least 70 percent of the Gross Asset Value of the Company will be invested in Vietnam. Up to a maximum of 30 percent of the Gross Asset Value may also be invested in neighbouring Asian countries (namely China, Cambodia and Laos), should the Directors consider that such investments would offer potentially attractive returns.. During the Cash Return Period, the Company will not make any new investments, unless additional funds are required for existing projects within the Company’s property portfolio.
The Company during the initial term targeted five property sectors: office, retail, residential, industrial and hospitality/leisure. The Company’s primary focus was on Ho Chi Minh City, with a secondary focus on Hanoi and key leisure areas, including but not limited to Nha Trang, Hoi An and Danang. During the Cash Return Period, the Company will not make any new investments, unless additional funds are required for existing projects within the Company’s property portfolio.
Control of investments:
The Company will seek to own a controlling interest in its investments, either by owning a direct controlling participating interest in the project or by controlling the investee companies through which the investments are made. In the event that the Company holds a minority interest in a project, it will seek to secure adequate minority protection rights.
Realisation of investments:
The Company is a publicly listed investment company on the London Stock Exchange’s AIM. Investors are free to purchase and sell shares whenever they please. The Company will aim to realise individual investments when the Board, with the advice of the Investment Manager, the Investment Committee and the Development Adviser, believes the realisation would be in the best interests of the Company and fulfil its investment objectives. The Company intends to affect exits through disposals of its projects or interests in investee companies to institutional and private investors.
The Company will seek to realise its existing property portfolio at the best possible value and in a reasonable timeframe. The Company will only continue with the development of selected mixed use (which may include retail/commercial use) and residential projects, within its existing portfolio of property assets. This will enable full or partial realisations of those projects and also generate revenue from the sale of the residential property, currently in its property portfolio. The Company will also undertake preliminary infrastructure works on the larger projects in its property portfolio, in particular to expedite the completion of works to comply with statutory requirements. This will enable the Company to realise these assets more quickly and will also increase their realisation value. The completion of work to satisfy regulatory requirements also means that the land on these projects may be split into smaller parcels of land. This creates an opportunity for secondary value and should also increase the realisation value of the asset.
During the Cash Return Period the net proceeds of all portfolio realisations will be returned to Shareholders, at the Board’s discretion, having regard to requirements to invest further funds in existing projects within the Company’s property portfolio to enhance or preserve exit values; the Company’s working capital requirements (including the fees payable under the Amended and Restated Investment Management Agreement) and the cost and tax efficiency of individual transactions and/or distributions.
No single investment may, at the time of investment, exceed 20 percent of the Gross Asset Value.
If the Investment Manager and the Directors deem it appropriate, the Company may also invest up to 20 percent of its Gross Asset Value in other property funds which themselves invest in property in the target region. All investments must be approved by the Investment Committee and, where a project or investment exceeds ten percent of the Net Asset Value, in addition, the approval of a majority of the Board must also be obtained.
There is no limit in the Company’s articles of association to the amount of borrowings that it may incur. As is typical with real estate development and investment, investee companies may use leverage for individual projects. All leverage will be non-recourse to the Company and will be incurred by the investee companies. The level of the debt incurred will vary depending on the laws and regulations pertaining to the debt market with regard to the particular type of project and the ability of the relevant Investee Company to service the debt.
The Directors will review the investment policies on an annual basis.
Changes to the investment policies may be prompted, inter alia, by changes in government policies or economic conditions which alter or introduce additional investment opportunities. In the event of a breach of any investment restrictions, the Investment Manager shall inform the Board upon becoming aware of the same and if the Board considers the breach to be material, notification shall be made to a Regulatory Information Service Provider.
Cash pending investment, reinvestment or distribution will be placed in bank deposits, bonds, government-issued treasury securities or in local money market funds for the purpose of protecting the capital value of the Company’s cash assets.
In order to hedge against interest rate risks or currency risk, the Company may, where appropriate, also enter into forward interest rate agreements, forward currency agreements, interest rates and bond futures contracts and interest rate swaps and purchase and write (sell) put or call options on interest rates and put or call options on futures on interest rates.
It is intended that the Company’s income will consist wholly or mainly of investment income. The Directors currently intend to reinvest a large part of income to take advantage of opportunities meeting the Company’s investment and return objectives, and where suitable opportunities are not available to distribute substantially all of the Company’s income and capital gains after administrative expenses and tax to holders of the Ordinary Shares, and aim to increase dividends over the life of the Company.
Life of The Company
The Company does not have a fixed life but the Board considers it desirable that Shareholders should have the opportunity to review the future of the Company at appropriate intervals. The current term is for a period of approximately three years and commenced on 22 November 2016.