Halico - the wine empire in decline with leadership scandal

Hanoi Alcohol Company (Halico) was formerly Hanoi Wine Factory built by the French wine company Fontaine in 1898. This was the largest factory of the five facilities built in the Indochina region at that time.

Halico had expected to grow strongly after the golden years at the beginning of the decade.

After more than a century of development, Halico has gradually reached the pinnacle of glory with record revenue and is compared to a "century brand" or "timeless brand". This is the owner of a series of brands such as Hanoi Vodka, Lua Moi, Nep Moi, Vodka 94 Lo Duc, Ba Kich Sealion...

The period 2008 - 2012 was when Halico grew strongly, revenue grew rapidly, affirming its number one position in the wine industry of the country. Revenue and profit in 2008 reached about 680 billion VND and more than 160 billion VND respectively, soaring to nearly 1,060 billion and 220 billion VND just one year later. In the years 2011-2012, the unit's revenue exceeded the trillion mark, with after-tax profit exceeding 200 billion VND.

Also in 2012, Halico built the Bac Ninh wine factory - one of the most modern factories in Asia with a capacity of 40 million liters of wine and one million liters of alcohol per year.

Halico has been in decline for the past 4 years.

In 2011, Diageo Group - the world's largest alcohol giant from the UK had to spend up to 800 billion VND to own 18.67% of Halico's shares at a price of up to 214,000 VND per share. After that, Diageo increased its ownership to 45.5% and became the second largest shareholder here. Diageo valued Halico at about 4,300 billion VND at that time.

However, in 2013, the company's revenue dropped sharply to 640 billion VND, with a profit of only 29 billion VND. The long slide continued into 2014 when the parent company's revenue dropped to 397 billion VND, with a pre-tax profit of 30 billion VND. Also in this year, Halico's leaders and employees fell into legal trouble, such as the case of former Director - Ho Van Hai for tax evasion.

In 2015, business continued to decline when revenue reached 453 billion VND, loss 21 billion VND (loss from business activities was 26 billion VND).In 2016, the company planned revenue of 549 billion VND, profit of 13 billion VND, but by the end of the first quarter, it had a loss of 10 billion VND, domestic revenue decreased by 30% compared to the same period.

At the end of 2014, after Director Ho Van Hai was prosecuted, Mr. Mai Van Loi - who was Director of Lam Kinh Hotel - was transferred here by the management agency. In 2015, Mr. Mai Van Loi held the position of Director of Halico, before becoming Chairman of the Board of Directors.

However, during his time running the business, in addition to the unsatisfactory business results, Mr. Loi was also known for his relationship and many strange decisions related to Mr. Trinh Xuan Thanh - who has received a lot of public attention recently with the scandal of driving a blue-plate car and transferring to Hau Giang province against procedures...

Specifically, after taking power at Halico, Mr. Loi decided to transfer 500 million VND to support Hau Giang province when Mr. Trinh Xuan Thanh was just appointed as Vice Chairman of the province without being approved by the Board of Directors. Mr. Loi also appointed Mr. Thanh's son, Trinh Hung Cuong (born in 1992) as Deputy Head of the Marketing Communications Department and appointed the son of Habeco Chairman - Do Xuan Ha, Do Xuan Long (born in 1990) as Deputy Director in charge of business. Most recently, there was the incident of Halico lending a billion-dollar Mercedes-Benz to the Ministry of Industry and Trade according to Mr. Loi's decision...

According to VNE