
Hanoi (VNA) –The State Capital Investment Corporation (SCIC) is under pressure to completeits divestment scheme towards the end of this year with many large companiesstill in its portfolio.
Characterised as the sovereign wealth fund in Vietnam, SCIC has planned todivest capital from 85 State-owned enterprises this year, of which it hascompleted proceedings for 20 companies.
In a seminar with potential investors at the Gateway to Vietnam 2017 held bySaigon Securities Inc recently, the State capital corporation said it wouldstrive to accomplish the plan on schedule with information of its futuredivestment plans being released by the end of November or early December.
According to market observers, SCIC is under high pressure as many in itsportfolio are big companies including Vinamilk (VNM), Binh Minh Plastics JSC(BMP), Tien Phong Plastics JSC (NTP), IT giant FPT Corp (FPT), Vietnam Constructionand Import-Export JSC (VCG), Domesco Medical Import Export JSC (DMC) and SaGiang Import Export Corp (SGC).
SSI’s current portfolio includes 132 companies with total market capitalisationof around 4.7 billion USD, of which its holding in Vinamilk is the mostvaluable at 3.82 billion USD, based on Vinamilk’s share price on the HCM StockExchange on October 30.
In mid-October, the sovereign fund announced it will auction a 3.33 percentstake in Vinamilk on November 10. The initial selling price has yet to bedecided but SCIC Chairman Nguyen Duc Chi said it would be close to the marketprice.
Vinamilk’s shares are being traded at around 152,000 VND (6.70 USD) per share,and its price has increased about 21 percent this year.
Meanwhile, SCIC’s divestment plan in FPT Corp and two big pharmaceuticalcompanies, Traphaco and DHG, has yet to be announced.
Besides Vinamilk, Vietnam Construction and Import-Export JSC is likely to beSCIC’s next major divestment in the context that it previously planned tooffload the entire holding of 22 percent stake in this company.
SCIC wants to promote the competitive bidding process (instead of selling amajority stake to strategic investors) to enhance transparency in thedivestment process.
This process usually involves hiring consultants, organising road shows (inboth domestic and international markets), setting initial selling prices andlaunching auctions on the stock exchange.
Its efforts to simplify procedures for investors to participate in auctionshave been demonstrated in the next share sale of Vinamilk in November. Foreigninvestors can make deposits in the US dollar while the State SecuritiesCommission allows extending time for registering transaction codes forinvestors.
Listed companies shall also be exempt from making a public bid but must sendinterest of purchase to the auction board seven days before the auction.
In addition, SCIC is considering asking for the Government’s approval to sell awhole lot of shares for a better price.
SCIC, established in 2006, operates with two main functions: representing theGovernment’s capital interests in State-owned enterprises and investing inState capital in key sectors and essential industries. About 1,000 enterpriseshave been transferred to SCIC since then, in which the Government hascompletely withdrawn capital from 876 enterprises.-VNA
VNA