At the end of May, the local market was surprised by the deal Streetcar Investment Holding purchasing five million Halico shares at VND213,600 per share, more than double the market price of some VND100,000 and more than 20 times higher the shares’ par value of VND10,000.

The England-backed firm continued offering to buy additional o­ne million shares of the local company at the same price.

Some contributed the deal’s high price to Halico’s good profitability. The drink-maker’s after-tax profit reached VND162.4 billion ($7.8 million), 2.3 times higher than its chartered capital of VND70.6 billion ($3.4 million) in 2008. Those figures were of VND220 billion ($10.6 million) and VND108.5 billion ($5.2 million) respectively in 2009.

At the end of 2010, although Halico’s profitability reduced with after-tax profit hit VND129.2 billion ($6.2 million) and while chartered capital of VND200 billion ($9.6 million), its equity had risen to VND603.7 billion ($29.1 million).

Streetcar’s deal is similar to Lotte Confectionery Co. Ltd’s purchasing nearly 40 per cent stake of Bien Hoa Confectionery Joint Stock Corp in 2008, and Oman Investment Fund (OIF) buying 12.6 per cent PetroVietnam Insurance (PVI) stake last year, which also priced those company’s shares at nearly twice the market prices.

Nguyen Anh Tuan, PVI chairman said: “Purchasing PVI shares is just the foreigner’s first step to set their foothold in Vietnamese market. They had to own a sufficient shares amount which is not easy to be collected via exchange, thus they accepted such price.”

After the deal with PVI, OIF boosted its investments in the local petroleum sector, such as frequently pumping money as well as providing services to national oil and gas giant PetroVietnam.

Hanshin Engineering & Construction Co. in late June also bought 25 million PetroVietnam Construction shares at VND25,000 per share, doubling the market price at that time.