VietNamNet Bridge – The
restart of the State owned enterprises (SOEs) equitization process has been
seen by experts as the golden opportunity for the merger and acquisition
(M&A) market.
The government has decided to refresh the SOE
equitization process which once reached a deadlock due to the sharp falls of
the stock prices. The Ministry of Finance (MOF) has recently announced the plan
to restructure 889 SOEs in 2011-2015, of which 367 enterprises would be
equitized, while the other 532 enterprises would be either put for assignment,
sale, contracting, leasing or dissolution.
Also according to MOF, 93 SOEs have registered to carry
out the equitization right in 2012, including the 22 SOEs belonging to
ministries, 33 SOEs under economic groups and general corporations, and 33
local enterprises.
The list of the SOEs includes the big names that foreign
investors have been eyeing, such as Vinatex, a textile and garment group, Binh
Son petrochemical refinery, Viglacera, a building material manufacturer, or
Lilama – the machine installation and construction corporation.
Prior to that, the Vietnam Shipbuilding Industry Group
Vinashin offered to transfer its stakes in 32 companies in different fields,
from investment funds, gas, tourism, porcelain to oil rig manufacturing.
Thirteen subsidiaries and the land assets at four other
subsidiaries of the shipbuilding groups have also been put on sale.
The land properties include 318,000 square meters in
waters area for aquaculture in Quang Binh and Thua Thien-Hue provinces; the
land plot for education establishments and the new urban areas in Da Nang City
and Quang Nam province.
This is a part of the program on restructuring
enterprises of the big economic groups with 200 subsidiaries. Under the
program, Vinashin would retain 15 subsidiaries, two joint ventures, one
associated company by 2013
The restructuring process at Vinashin, plus the
equitization of a series of SOEs, are the goals of many investors.
According to Pham Tuan Anh, Deputy Director of the SOE
Renovation Department, there were nearly 6000 SOEs in 2001, while the figure
has dropped to 1309, while 60 percent of which would have to go equitized in
the time to come.
“The equitization process would be sped up, which would
serve as a great opportunity for investors to make merger and acquisition
deals,” Tuan said.
Andy Ho. Managing Director of VinaCapital, the investment
fund which has invested in four SOEs, including Vinamilk (dairy producer), Phu
My Fertilizer, Lam Thao Fertilizer and Phuoc Hoa rubber, has said that the
equitization process in Vietnam, an indispensable activity in a developing
market of Vietnam, has entered the final stage.
He believes that the liquidity in the stock market would
increase, thus pushing up merger and acquisition affairs. He can see a high
possibility of SOEs making IPO (initial public offering) in the next three
years.
The list of attractive enterprises, according to Andy Ho,
includes Vinatex, Vietnam Airlines, Vinafood 1 and Satra. Especially, the
equitization of MobiFone, a big telecom corporation with the turnover of 2.1
billion dollars and pretax profit of 286 million dollars, has become very
attractive in the eyes of investors.
The government of Vietnam has been urged to speed up the
equitization of SOEs as an effort to restructure the state owned economic
sector which is enjoying most of the national resources, but still cannot bring
the desired effects.
Source: TBKTSG
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