Chairwoman Mai Kieu Lien announced this Friday at the general meeting of GTNFoods, a subsidiary of Vinamilk.

GTNFoods recently sought shareholders’ approval for it be merged with husbandry company Vilico and delist from the Ho Chi Minh Stock Exchange (HoSE).

Lien, also chairwoman of GTNFoods, explained that the company does not have a distinguishing operation of its own and mostly depends on contributions from Vilico, in which it owns a 74.49 percent stake.

The merger therefore will simplify its business structure and lower costs, ensuring more effective use of resources, she said, adding that after the merger, Vilico should focus more on developing its milk and beef products.

After the merger, which is set to happen in August, a GTNFoods shareholder can trade 16 GTN shares for 10 Vilico (VLC) shares. GTNFood will then cease to exist.

Vilico aims to be a major husbandry producer in Vietnam, aiming to see revenue grow by 9 percent year-on-year to VND3 trillion ($130 million) this year.

It plans to invest in a breeding farm to produce 20,000 cows a year.

GTNFoods became a subsidiary of Vinamilk in 2019 as the dairy giant sought to acquire Moc Chau Milk, whose products are popular in northern Vietnam.