Gov’t: No more State ownership at Vinamilk
Gov’t: No more State ownership at Vinamilk
State Capital Investment Corporation (SCIC) can sell its 45.1% stake at Vietnam Dairy Products Joint Stock Company (Vinamilk) following the Government’s approval, making the dairy processor wholly privately owned.
The divestment is approved in Document 1787/TTg-DMDN on a restructuring plan of SCIC, which represents the State as a stake holder at the nation’s leading dairy firm.
The document signed by Deputy Prime Minister Vu Van Ninh and sent to SCIC last week includes a list of 10 enterprises where the State will sell its shares. SCIC is told to divest State holdings at the enterprises on a date of its choosing and submit a related report to the Prime Minister for approval.
Meanwhile, SCIC is also allowed to retain long-term investments at nine enterprises including Bao Viet Holdings (BVH), Traphaco Joint Stock Company (TRA), DHG Pharmaceutical Joint Stock Company (DHG) and Domesco Medical Import Export Joint Stock Corporation (DMC).
When introducing the regulation on raising the foreign ownership limit in the middle of this year, the Ministry of Finance mentioned a possible ownership increase at insurance companies to 100%. But with the document, the possibility of raising the ownership limit at Bao Viet Holdings might need a reconsideration.
With the current prices, the State can fetch at least US$4 billion, with the State holding at Vinamilk alone amounting to around US$2.46 billion.
The huge amount is sufficient to offset this year’s budget deficit and helps the Government restructure some domestic debts of around US$2 billion.
In addition, the capital divestment is expected to accelerate the restructuring of State-owned enterprises which has been lagging.
