Gov’t approves Vietnam Airlines privatization plan; IPO to launch late Nov
Gov’t approves Vietnam Airlines privatization plan; IPO to launch late Nov
National flag carrier Vietnam Airlines has received a go-ahead from the government for its plan to sell a 25 percent stake in a privatization drive, with an initial public offering (IPO) of shares slated for the end of November, an official said Thursday.
The government approved the Vietnam Airlines privatization on Wednesday, Nguyen Trong Dung, head of the business reform department, under the Government Office, told delegates at a seminar held by the Saigon Securities Inc. in Ho Chi Minh City.
The event, titled “Gateway to Vietnam 2014,” hosted discussions by major investors on seeking new investment chances in the country.
The revelation of the Vietnam Airlines IPO plan immediately became the hottest topic of the day.
Dung said that once privatized, the flag carrier will maintain its name, while the government will retain a 75 percent stake in the Hanoi-based airline.
Vietnam Airlines has a registered capital of VND14 trillion (US$661 million). It will sell a 20 percent stake to strategic partners, while the remaining five percent will be sold to other investors, according to the official.
The airline will issue 1,410,184,000 shares in the IPO, scheduled for late November.
Dung said Vietnam Airlines is required to be listed after privatization to create liquidity. The government will eventually reduce its stake in the airline to 65 percent “at a suitable time,” Dung said.
The government has assigned Minister of Transport Dinh La Thang to determine the starting price for Vietnam Airlines shares in the IPO, as well as to set criteria to choose strategic partners, according to sources.
The transport ministry is also tasked with deciding when the government will lower its stake in Vietnam Airlines.
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