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The path for big business equitization still rocky
Securities investors will have to wait and wait for precious commodities to be made available on the market, since equitization of many big enterprises, including Vinapaco, Vinatex, Petrolimex or Mobifone, still faces impediments.
The giant paper producer, Vinapaco, planned to make IPO (Initial public offering) on Hanoi Exchange in the first quarter of 2010 and then list shares on the bourse, an arrangement that has completely failed.
Do Xuan Tru, Chair of Vinapaco, revealed that the Government has ordered a halt on its equitization, so the corporation will shift to operating under the mode of a one-member liability company prior to July 1 and will be covered by the Enterprise Law.
There are many reasons for obstacles to its equitization, including difficulties in assessing member forestry companies. Since these companies join forces with other people, it is very difficult to fix its assets.
The Vietnam Textile and Garment Group has also been struggling to complete the process. Vinatex Chair Le Quoc An noted that, to date, most member companies have finished equitizing. Only three companies are still equitizing, including 8 Thang 3 Textile Company, Dong Xuan Knitted Company and Dong Phuong Knitted Company. Once their subsidiaries finish, they can equitize the holding company and complete equitization of the group by 2011.
However, An still cannot say when in 2011 this will happen, saying only that it depends on economic performance, especially on whether the stock market supports the IPO or not.
Recently, information has come down that in 2010 the Government will equitize Petrolimex, the petroleum import-export company, as well as Mobifone, the mobile phone service provider, and BIDV, a state-owned bank. If the plan is fulfilled, Vietnam will make a huge leap in the equitization process for state-owned enterprises.
According to Dau Tu Chung Khoan, the equitization of Petrolimex kicked off rapidly just after the Decision made by the Ministry of Industry and Trade on February 1.
After equitization, the State will still hold 75 percent of the chartered capital.
Petrolimex is determined to complete equitization in 2010, but economic analysts predict difficulties for this to happen so fast. Petrolimex is a large company, and assessing its value alone will take a long time.
No signs have emerged to show that equitizatioin of Mobifone and BIDV has begun in earnest. A Ministry of Information and Telecommunications representative explained that the ministry is awaiting new decisions from the Government on Mobifone’s plan.
Explaining equitization difficulties, Minister of Finance Vu Van Ninh stated before the National Assembly’s Standing Committee that it is now time to equitize economic groups, member companies of large groups and general corporations. He added that assessments will be very difficult and the unstable recovery of the stock market has also influenced the equitization process.
The Government has assigned the Ministry of Finance to amend Decree 109 promulgated in 2007 on equitizing enterprises in order to settle the problems. The draft decree will be open for one month to gather public opinion.
VietNamNet, DTCK
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