SCIC to promote divestment at SOEs
SCIC to promote divestment at SOEs
The State Capital Investment Corporation (SCIC) will boost the process of divestment of non-core businesses at several State-owned enterprises (SOEs) this year.
This follows Decision 2344/QC-TTg of the Prime Minister, announced on December 2, 2013, which highlights the approval of the restructuring plan of the SCIC by 2015.
During this year, the corporation will have to consider buying financial instruments issued by SOEs if they fail to divest capital held at various banks.
It's good news for the State-owned groups and corporations, which were finding it difficult to find partners for stake transfers, especially in the real estate, financial and securities sectors.
In some circumstances, a loss may occur during the divestment process. Therefore, enterprises are afraid of taking responsibility for a loss and only conduct divestment when the capital market is strong.
To help SOEs speed up non-core divestment, a new resolution is expected to be approved by the Government in the first quarter of 2014 to allow SOEs to divest capital below the par value after setting up reserve funds for the investments as required.
The SCIC, formed under Decision No 151/2005/QD-TTg dated June 20, 2005, is responsible for managing and investing State capital in various sectors, including financial services, energy, manufacturing, and telecommunications. Transportation, consumer products and healthcare sectors are also under its purview.
In November 1, 2013, the Government issued Decree 151/2013/ND-CP, which enabled a number of new mechanisms consistent with significant functions of SCIC, including the sale of State-owned capital.
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