Legamex Suspends Manufacturing Operations to Stem Losses
On May 16th, Legamex, a leading footwear and garment manufacturer, announced its decision to temporarily halt manufacturing operations from May 2025 to curtail losses and alleviate financial strain. The company aims to resume operations when the domestic and global textile industry recovers and it can meet the required conditions.
According to the 2025 Annual General Meeting documents, Legamex faced significant challenges in 2024, including financial woes and difficulties in securing stable and abundant garment processing orders to increase productivity and expand operations.
Amazon’s Impact and the Road to Recovery
Legamex, like many businesses, felt the ripple effects of Amazon’s decisions. Similar to Garmex Saigon, Legamex faced disruptions in fabric cabinet orders for Gilimex since late 2022. By the end of 2023, Legamex had transitioned to focus on fashion garment manufacturing.
However, this market demands high technical standards, specific raw materials, and substantial resources to enter. Legamex, lacking the necessary resources for large-scale exports, relied on local partners for garment processing. As a result, finding partners, negotiating prices, and securing orders during this period proved challenging, with most deals involving small quantities, low unit prices, and tight production and delivery timelines, hindering the company’s efficiency and profitability.
In 2023, Legamex’s revenue plummeted to just over VND 31 billion, a 76% decline from the previous year, resulting in a record loss of nearly VND 63 billion. The company continued to incur losses in 2024, amounting to more than VND 33 billion. This marks the sixth consecutive year of losses for Legamex, with cumulative losses as of December 31, 2024, surpassing VND 166 billion, and negative equity of nearly VND 79 billion.
The company also faced a continuous decline in its direct production workforce due to challenges related to salaries, bonuses, and associated benefits. The post-pandemic migration of workers from urban areas back to their hometowns further exacerbated the difficulty in recruiting new employees. By the end of 2024, Legamex had 202 employees, a reduction of 68 from the beginning of the year.
Additionally, most of the company’s machinery and equipment are over a decade old, and the lack of investment in automation has impacted production efficiency.
Leadership Changes and Shareholder Dynamics
On March 11th, Mr. Le Hong Chien resigned from his position as CEO of Legamex for personal reasons, and Mr. Huynh Tang Phuc Hau was appointed as his replacement. Towards the end of April, Mr. Chien was also relieved of his duties as a member of the Board of Directors, and Mr. Hau was elected to the Board.
In early April, there was a change in the position of Chief Accountant, with Mrs. Nguyen Thi Lan Tra stepping down and Mr. Vo Phu Hung, the former Head of Administration and Human Resources, taking on the role for a one-year term.
Mr. Chien was the CEO of Giditex, a company that previously held a 51% stake in Legamex. However, in January 2024, Giditex divested its entire holding in Legamex, leading to the subsequent resignation of Legamex’s entire Board of Directors and Supervisory Board.
In May 2024, a group of major shareholders holding a combined 72.67% of LGM shares sold their entire stake, exiting the company. Simultaneously, Ha Nam Company acquired nearly 5.4 million shares (72.67% of LGM’s capital), becoming a new major shareholder. Ha Nam, established in March 2024, specializes in management consulting and is jointly owned by Mr. Do Van Huy (80% stake) and Mrs. Bui Thi Thuy Chung (20% stake).
Legamex successfully completed a private placement of 4.44 million shares at VND 15,000 per share, raising VND 66.6 billion and increasing its charter capital to VND 118.4 billion. Ha Nam Company purchased nearly 4 million shares, increasing its ownership to 79.17%.
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