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Jetstar Pacific’s biggest shareholder wants to cut stake
Vietnam state investment arm SCIC has sought approval from Prime Minister Nguyen Tan Dung to slash its holding in loss-making budget airline Jetstar Pacific and allow other domestic businesses to invest in the airline.
SCIC, or State Capital Investment Corporation, holds a 75.78 percent stake in Jetstar Pacific. Australian flag carrier Qantas is the next biggest shareholder with an 18 percent stake. State-run tourism group Saigontourist holds 6.18 percent and a Vietnamese investor holds 0.04 percent.
In a note sent to Dung in October, SCIC said the low-cost airline needed US$30-35 million next year to “stay stable and develop in upcoming years.” It sought the permission to allow Qantas to raise its stake in the carrier to 49 percent, above the current foreign ownership cap on airlines of 30 percent.
But late last month, SCIC sent another note to Dung, saying “raising the foreign investor’s stake to 49 percent is not appropriate at the moment.” SCIC proposed selling part of its stake to other domestic investors instead.
SCIC said Jetstar Pacific had made a loss of $22 million in the first 10 months of this year.
The company blamed the poor performance on high fuel costs earlier this year and foreign exchange fluctuations.
If no action was taken to help the airline, it would run out of money by the end of this year, the SCIC warned.
SCIC was created in mid-2005 to take controlling stakes in thousands of the country’s state-run enterprises.
Xuan Toan
thanhnien
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