Foreigners eager to buy, but Government slow to respond
Foreigners eager to buy, but Government slow to respond
Foreign investors are eager to buy stakes in Government-owned enterprises in Viet Nam, but have come up against a lack of transparency in the firms' information disclosure, as well as red tape, CEOs from financial firms said.
Foreign investors have the best opportunity of buying into the State-owned enterprises (SOEs) from which the Government wants to divest as not many local buyers can afford to buy them from the State. Most Vietnamese private companies would be unable to compete against foreign investors in purchasing assets worth VND149 trillion (more than US$6.62 billion), HCM Securities Corporation CEO Johan Nyvene said to a Vietnam News Agency correspondent.
Large-cap companies such as Vinamilk are valued at billions of dollars and most domestic buyers seem to lack financial capabilities to purchase stakes in those companies, he said.
The Vietnamese Government plans to sell its stake in 12 large SOEs, including Viet Nam Dairy Products JSC (Vinamilk), information technology FPT Corporation (FPT), Bao Minh Insurance Corporation, Tien Phong Plastic JSC, Binh Minh Plastic JSC, and the two largest brewers Sai Gon Beer Alcohol Beverage JSC (Sabeco) and Ha Noi Beer Alcohol Beverage JSC (Habeco).
The State Capital Investment Corporation (SCIC), the representative of the State's holdings in the large-cap SOEs, plans to sell an entire 9 per cent stake in Viet Nam Dairy Products Joint Stock Company (Vinamilk) by the end of this year.
Sabeco and Habeco have been recently told to get listed on the stock market before they begin selling the State's stakes to private investors. Sabeco is planning a listing by the end of this year while Habeco is expecting to be traded by early next year.
Next year, SCIC will offload its shares in nine other SOEs, including Viet Nam National Reinsurance Corporation (Vinare), Ha Giang Mineral Mechanics Joint Stock Company, Viet Nam Infrastructure Investment and Development Joint Stock Company (VIID), and Sa Giang Import Export Corporation.
However, the sales of those SOEs has been delayed as private investors are not satisfied with the firms' information disclosure process. Some investors are also wary of the fact that the bidding process is not transparent as the Government prefers selecting a strategic investor, who later owns a large part of the company's capital, to bringing the deal to the public so that all investors can compete equally.
On Wednesday, Sabeco CEO Le Hong Xanh told Reuters that "The listing could be in late November, early December, according to the consulting contract and agreement, but how fast it is depends on many other factors, like transparency in management and other conditions like tax."
Complicated procedures are also delaying the State's divestment from those SOEs. "There are many interested investors but we haven't started talking specifically with anyone, we are waiting for the Government," Reuters cited Xanh as saying.
