The HAGL-owned general hospital in Pleiku City in the Central Highlands province of Gia Lai - Photo: HAGL

Hoang Anh Gia Lai (HAGL) Group has issued bonds valued at VND500 billion (some US$23.7 million) to raise funds for its rubber plantation and hydropower generation projects underway in Laos, the group’s leader said.

HAGL chairman Doan Nguyen Duc confirmed the latest bond issuance with the Daily on the phone on Tuesday, saying that this issue was assisted by the Bank for Investment and Development of Vietnam and BIDV Securities Company.

The three-year bond carries an annual coupon of 18% for the first year. The coupon is paid every 12 months and is adjusted in accordance with the deposit interest rate applied by branches of BIDV and other major banks in Gia Lai Province for individuals plus 4% a year.

The VND500 billion would be used as additional capital for the projects that HAGL was carrying out in the neighboring country, Duc said. The group needs hundreds of millions of U.S. dollars for its projects in Vietnam, Laos and elsewhere in Indochina, Duc said.

The Gia Lai-headquartered group is planting around 25,000 hectares of rubber trees in Laos as part of a plan to have 51,000 hectares of rubber trees by 2012 in Vietnam’s Central Highlands region as well as in Laos and Cambodia. The group expects to finish growing the 51,000 hectares this year, with more than US$225 million of investment capital planned for this area.

HAGL said more than 35,700 hectares of the total planned acreage had been covered with rubber trees, and the group planned to exploit latex from rubber trees it had planted in Laos in the middle of this year.

HAGL has to count on issuing bonds and selling shares as among the channels to find funds to finance its projects at home and abroad when the access to bank loans in Vietnam is difficult coupled high interest rates.

Over the past two years, the group has been able to raise over US$260 million from share and bond issues, including US$55 million worth of convertible bonds issued to Temasek Holdings of Singapore, US$90 million worth of five-year bonds on the Singapore Stock Exchange and US$60 million through secondary listing on the London Stock Exchange.

HAGL is operating and developing hydropower projects with combined generation capacity of 420 megawatts and investment capital of over US$330 million in Vietnam and Laos.

Currently, Dak Srong 2 and Dak Srong 2A hydropower plants are operational. The group plans to commission the 80-megawatt Ba Thuoc 2 and the 19.5-megawatt Dak Srong 3B in the first quarter of this year.

In another development, HAGL opened a general hospital in Pleiku City in the Central Highlands province of Gia Lai after more than three years of construction to provide health checks and medical treatment for locals and patients from other parts of the region.

The University Medical-Hoang Anh Gia Lai Hospital covering five hectares has 10 health examination departments in the initial stage out of the 24 departments planned for the entire project with investment capital of more than VND200 billion (less than US$10 million).

The first private hospital in Gia Lai Province will be expanded to accommodate 300 in-patient beds in 2013 and more departments in the future. A center will be set up to promote medical technology transfer for the Central Highlands region and support medical development there in line with a cooperation agreement that HAGL signed with the University Medical Center under the HCMC University of Medicine and Pharmacy in March 2011.