Vietnam Airlines plans IPO

Major companies including Vietnam Airlines and the Vietnam Industry Construction Group are planned to make initial public offerings this year.

The Vietnam Mobile Telecom Services, which operated the MobiFone mobile network, will equitise this year to restructure and improve its competitiveness, Minister of Information and Communication Le Doan Hop said last week.

Related parties will begin discussions for it next month, he added.

Last year MobiFone had a pre-tax profit of 5.86 trillion VND (272.5 million USD) on a turnover of 36 trillion VND (1.67 billion USD).

Vietnam Airlines chairman Nguyen Sy Hung said an equitisation plan was being worked out for submission to the Government.

The carrier's general director Pham Ngoc Minh said Vietnam Airlines was considering the best time for an IPO.

Last year, it reported a turnover of 36.3 trillion VND and a pre-tax profit of 350 billion VND, up 47 percent and 100 percent from 2009, respectively.

The Vietnam Industry Construction Group plans to equitise nine affiliates, with three of them – Vietnam Machinery Erection Corp (Lilama), Infrastructure Development & Construction Corp and Construction & Engineering Corp – expecting to do so this year, according to the group's general director Duong Khanh Toan.

The businesses are, however, concerned about possible difficulties.

Toan said the pace of the equitisation will largely depend on factors like the state of the country's economy and stock market.

High inflation would contribute to high interest rates that usually limited the flow of funds into the country's stock market.

Hung also shared this worry, saying that Vietnam Airlines' IPO depended on whether the securities market offered favourable conditions.

Vietnam Airlines was included in a Government list of State-owned enterprises to go public in the 2007-10 period.

The plan failed to take off due to various reasons, including the declining stock market./.

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