EVN Telecom’s equitisation plan yet to be fully approved

Ministry of Industry and Trade’s leaders on June 15 had a meeting with the Electricity of Vietnam (EVN) to discuss change in equitisation of EVN Telecom. However, the details of the meeting were kept secret.
EVN Telecom representative told VnEconomy (Thoi Bao Kinh Te Vietnam Online) that the ministry has not agreed and made final decision on the issue. EVN may have to supplement and complete its equitization plan and it is expected that it could announce the final consideration result in 10 days.

Late January, the government officially approved EVN Telecom’s equitization plan that was proposed to be conducted via selling a part of current state stake in EVN Telecom to strategic investors and offering preferred shares to its employees.

Accordingly, EVN will hold 50.6% in chartered capital of its telecommunication affiliate, sell 0.4% to the strategic investor namely FPT Joint Stock Co and 49% to FPT Telecom. Previously, FPT kept over 50% in EVN Telecom.

But less than 3 months later, FPT officially announced to withdraw investment capital from EVN Telecom with a reason that they could not reach an expected holding ratio.

Regarding change in coming equitization, an EVN Telecom official said that the firm will only be able to sell stake to one domestic partner and disallowed to offer to foreign partners according to the government’s regulation.

In fact, seeking domestic investment partners is also not easy for EVN Telecom. After FPT withdrew from EVN Telecom, some sources said that another local firm Vietnam Multimedia Corp (VTC) is expected to invest 800 billion dong into over EVN Telecom, much lower than the initial ambition of FPT.

Till this time, EVN and VTC are keeping negotiation on holding ratio, price and related terms, the official revealed.

If the negotiation with VTC succeeds, it will open new opportunity for EVN Telecom to enhance financial strength, reinforce brand name and search for new business plans. – Vietbiz24

Tags: EVN Telecom