J.P. Morgan to revive Vimpelcom’s struggling Vietnam venture?
J.P. Morgan to revive Vimpelcom’s struggling Vietnam venture?
J.P. Morgan may be investing in Gtel Mobile, the operator of the Gmobile network.
As reported by newswire vneconomy, at a meeting between Deputy Minister of Information and Communications Phan Tam and Vijay Pattabhiraman, CIO of Asian Infrastructure Group under J.P. Morgan Institutional Asset Management on September 9, the deputy minister congratulated J.P. Morgan on picking Gtel Mobile for cooperation in Vietnam.
Phan said that J.P. Morgan Chase’s investment in the Vietnamese telecom market comes at a very opportune moment as the market is stepping into a new era of explosive growth, and wishes J.P. Morgan Chase success.
According to Phan Tam, the Ministry of Information and Communications wants to establish a competitive telecom market featuring a number of big operators. The Ministry thus supports the participation of foreign operators in order to increase competition and “breathe new life” into the market.
He also said Vietnam is going to pilot a scheme where users can change their networks but keep their phone numbers and that this is going to be a big chance for new operators if they can provide good services to compel a change of subscriptions.
At the moment, the two sides have yet to announce concrete cooperation plans or the details of their agreement.
In March, it was rumoured that Gtel Mobile was set team up with a foreign partner for its telecommunications network and service development.
In Vietnam, J.P. Morgan has offices in Hanoi and Ho Chi Minh City, providing treasury services, corporate banking, foreign exchange, and money markets.
Gmobile is Vietnam’s smallest mobile network in terms of users, with a market share of 3.22 per cent as of the end of 2014. It was once expected to leave the market. For the past two years, the number of users has been low and their activity was also relatively low. Gmobile has not issued new promotions recently.
Gmobile, previously Beeline, is operated by Gtel Mobile, a joint venture between Vietnamese company Global Telecommunications Corporation and Russian VimpelCom. Beeline started operation in 2009. In 2011, VimpelCom planned to invest another $500 million, bringing its total investment in the venture to $1 billion. However, it only disbursed $200 million, and raised ownership in the venture to 49 per cent. A year later it sold its stake to Gtel.
