Login
 
    19:32 – Fitch upgrade Greece debt, sees steady improvment 
» » Vietnam plans massive sell-off in state-owned firms early next year

Vietnam plans massive sell-off in state-owned firms early next year

Vietnam plans massive sell-off in state-owned firms early next year
Vinamilk products are displayed for sale at a Vinamilk shop in Hanoi, Vietnam May 16, 2016. Photo by Reuters/Kham

Vietnam has set a timeline for divesting from major state-owned companies by early next year, the Finance Ministry's online portal cited Dang Quyet Tien, a senior official from the ministry, as saying on Thursday.

Prime Minister Nguyen Xuan Phuc specifically ordered the State Capital Investment Corporation (SCIC), the government's investment arm, to continue divestments from state-owned enterprises during a meeting last month.

The companies on the list include 10 major listed enterprises with public stakes managed by the SCIC, and unlisted breweries Sabeco and Habeco, currently under the control of the Ministry of Industry and Trade.

It is estimated that the government could rake in more than $5 billion from share sales in the big ten, that includes Vinamilk, IT giant FPT and insurer Bao Minh.

Successful exits from Sabeco and Habeco will add about $2 billion to the state budget.

The latest push for privatization of state-owned enterprises will be conducting in accordance with market forces, said the Prime Minister, who promised an equal chance for both foreign and local investors.

Vietnam has removed a long-standing 49 percent foreign ownership cap, allowing foreign investors to acquire a 100 percent stake in companies such as Vinamilk, in which the government currently holds a 45 percent share.

For other companies, the government will divest gradually to prevent the stock market from overheating, said top trade official Tien.

The privatization of Sabeco and Habeco has been long delayed because they are among the few state-owned enterprises that are performing well.

Sabeco has 46 percent of the local beer market while Habeco has 17 percent. They remain 90 percent and 82 percent state-owned, respectively.

Foreign investors have had their eyes on the two breweries for some time now after seeing the strong growth rate of Vietnam’s beer market. The Vietnam Beer Alcohol Beverage Association forecast the country will raise annual beer output by 25 percent by 2020.

The proceeds from the divestments will be partially funneled into existing state-owned enterprises, while the rest will be used to boost infrastructure and fund social welfare, Tien added.

Vietnam has sold shares in more than 500 companies in the past five years, government statistics show.

Rating: 
1 Phiếu /
READ MORE : Vietnam plans massive sell-off in state-owned firms early next year
Comment