Vietnam Airlines plans IPO

Major companies including Viet Nam Airlines and Viet Nam Industry Construction Group are determined to make initial public offerings this year.

The Viet Nam Mobile Telecom Services, which operated the MobiFone mobile network, would equitise this year to restructure and improve its competitiveness, Minister of Information and Communication Le Doan Hop said last week.

Related parties would begin discussions for it next month, he added.

Last year MobiFone had a pre-tax profit of VND5.86 trillion (US$272.5 million) on a turnover of VND36 trillion ($1.67 billion).

Viet Nam Airlines chairman Nguyen Sy Hung said an equitisation plan was being worked out for submission to the Government.

The carrier’s general director Pham Ngoc Minh said Viet Nam Airlines was considering the best time for an IPO.

Last year, it reported a turnover of VND36.3 trillion and a pre-tax profit of VND350 billion, up 47 per cent and 100 per cent from 2009, respectively.

The Viet Nam Industry Construction Group plans to equitise nine affiliates, with three of them – Viet Nam Machinery Erection Corp (Lilama), Infrastructure Development & Construction Corp and Construction & Engineering Corp – expecting to do so this year, according to the group’s general director Duong Khanh Toan.

The businesses are, however, concerned about possible difficulties.

Toan said the pace of the equitisation would largely depend on factors like the state of the country’s economy and stock market.

High inflation would contribute to high interest rates that usually limited the flow of funds into the country’s stock market.

Hung also shared this worry, saying that Viet Nam Airlines’ IPO depended on whether the securities market offered favourable conditions.

Viet Nam Airlines was included in a Government list of State-owned enterprises to go public in the 2007-10 period.

The plan failed to take off due to various reasons, including the declining stock market. — VNS

Tags: Vietnam Airlines IPO