Government to improve IPO procedures
Government to improve IPO procedures
The Government and the State Securities Commission (SSC) would have to improve the policies that had been preventing State-owned companies from being privatised, said officials and experts yesterday.
Bui Hoang Hai, the SSC's Deputy Director of Securities Issuance Management, said that 60 per cent of IPOs last year were successful. They had a total value of VND11.4 trillion ($530.23 million).
Hai said that during the first three months of this year, the percentage of successful IPOs and divestment was 44 per cent, with a total IPO value of VND1.25 trillion ($58.14 million).
He said that the reason for the lower numbers was slowness in information disclosure, adding that State-owned enterprises had to publish their profiles for IPO at least 20 days before they were auctioned.
However, many of them published their profiles much later, causing difficulties for investors to prepare capital and information about the auctioned enterprises, he said.
In addition, the auctioned enterprises only published basic information which was not attractive to strategic investors, he said.
The SSC's representative suggested that state-owned enterprises reveal more about their profiles and speed up the information disclosure to attract investors in a highly competitive market with limited sources of capital.
Nguyen Thi Hoang Lan, Vice General Director of the Ha Noi Stock Exchange (HNX), said her company had asked the SSC and the Ministry of Finance to improve the Unlisted Public Company Market (Upcom) to attract strategic investors by dividing the market into smaller sectors and developing specific indexes for those sectors.
She said that these recommendations would help investors get easier access to information and reduce administrative procedures to support auctioned enterprises.
She said that HNX would work with securities companies and consulting companies to assist the auctioned enterprises.
During the conference, participants suggested ways of improving the quality of IPO and divestment for State-owned companies.
Hoang Nguyen Hoc, Vice General Director of the State Capital Investment Corporation (SCIC), said that the SSC should allow State-owned companies to sell their stakes in even lots, which was an order for a security account of 100 shares for stocks.
He said that investors would find it cheaper, easier and more convenient to acquire state capital in even lots, raising the efficiency of IPO and divestment.
Vu Anh Minh, the Director of the Transport Ministry's corporate management division, said that IPOs would help State-run companies improve their performances and make larger contribution to the state budget.
