The shares were sold in trading session on May 11, Vietnam Investment Group (VIG), a private company owned by the family of billionaire Pham Nhat Vuong, Vingroup's board chairman, said in a statement Friday.

With Vingroup’s VIC shares having closed at VND97,500 ($4.19) a share Monday, the sale, which VIG said was made via the order-matched option to the general market, is estimated to be worth around VND49 billion ($2.1 million).

According to VIG, the shares were lent to Tan Hoang Minh Group (THM), a real estate developer, to use as collateral for a loan from a subsidiary of private lender Saigon-Hanoi Commercial Bank (SHB). VIG did not disclose the value of the loan.

However, because THM was not able to repay the debt, SHB decided to have the VIC shares liquidated through securities companies to recover its dues.

A senior SBH official, who declined to be named, told VnExpress that the bank had complied with all regulations before liquidating the shares.

The bank had repeatedly sent written notices to THM since January, and six times to VIG since last year, requesting that the debt be settled. "However, Tan Hoang Minh kept asking for the debt to be extended without providing a convincing repayment plan, while VIG said it would negotiate with its partner to find a solution," he said.

According to a representative of VIG, on May 8, the company received an official notice from SHS Securities, the securities arm of SHB, signed May 7, announcing that the VIC shares will be sold if THM cannot settle the rest of its debt, but the notice did not mention a deadline.

On Monday, May 11, SHS gave notice that it had sold the 500,000 shares. "Although we received the debt reminder from the bank, we were under the impression that SHB and THM were still in discussions to find a solution," the VIG representative said.

After this transaction, VIG remains the biggest shareholder in VIC, holding 1.12 billion shares in the corporation, equivalent to a 32.67 percent stake, down from 33.12 percent at the end of 2019.

According to Vingroup’s year-end financial statements for 2019, Pham Nhat Vuong, founder and chairman of Vingroup, was the corporation’s second largest shareholder, with 25.53 percent, and Pham Thu Huong, Vuong’s wife, held 4.4 percent.

VIC was among blue chips which were most strongly affected by the Covid-19 pandemic. VIC’s price fell nearly 38 percent from VND115,000 ($4.94) at the beginning of the year to bottom out at VND71,000 ($3.05) by late March. It then rebounded by more than 20 percent to VND96,400 ($4.14), in line with the benchmark VN-Index’s recovery from 690.25 points on March 25 to 827.03 points on Friday.

Vingroup, originally a real estate and retail heavyweight, has grown to become Vietnam’s largest private diversified conglomerate, and now sells cars, scooters, television sets and smartphones. It is also looking to enter the artificial intelligence sector.