FPT pulls the plug on EVN Telecom deal

FPT Board of Management has officially decided to withdraw from an acquisition deal with EVN Telecom.

The resolution said it agreed with the proposal to quit the investment project and will shortly take procedures for withdrawing all the capital investment it had deposited to EVN Telecom.

EVN Telecom is waiting for the government’s decision.

“We did not receive any official documents from FPT and if it wants to quit, it must get approval from the prime minister,” said an executive from EVN, parent of EVN Telecom.

FPT broke the news to EVN Telecom after six months of negotiations and a VND700 billion ($33.8 million) deposit with EVN Telecom for 3G network investment was made.

The amount of money was equivalent to a 12 per cent of stake in EVN Telecom. But, FPT has refused to pour further more money into EVN Telecom.

FPT said the rising investment costs for EVN Telecom’s 3G network development project due to the Vietnamese dong’s depreciation against the US dollar and surging bank interest rates as reasons for it getting cold feet.

Early this year, Prime Minister Nguyen Tan Dung approved EVN Telecom to sell a 49 per cent stake to FPT although the latter wanted to buy 60 per cent of the former’s stake.

Under the direction of the Ministry of Industry and Trade, the management agency of EVN, EVN Telecom must sell an aggregate stake of 25 per cent to institution investors before its IPO scheduled by the end of this year.

Beside, EVN Telecom’s deal to sell a 13 per cent stake to VTC’s arm Digicom has not yet been released. – VIR

Tags: EVN Telecom, FPT