Vietnam Airlines to conduct IPO in September


The IPO (initial public offering) of the national carrier, Vietnam Airlines Corporation, is scheduled for this September. After the IPO, the State will hold 70-80 percent of the firm’s capital.

IPO, vietnam airlines


Vietnam Airlines is valued at about $2.74 billion.


Vietnam Airlines CEO  Mr. Pham Ngoc Minh says that the firm’s value was assessed by two independent means, and the results reported to the Ministry of Transport and then submitted to the Prime Minister. He anticipates government approval in the next few days.

If it is determined on the book value, as of 31/03/2013, Vietnam Airlines had VND57,156 billion in assets (equivalent to US$2.744 billion), including VND10,567 billion ($507 million) of State capital.

The group also hired foreign consultants to evaluate its balance sheet according to international standards. By their estimation, Vietnam Airlines is valued at VND57,047 billion, equivalent to $2.74 billion, which closely aligns with the first estimate. However, the State capital, by their accounting, adds up to VND23,493 billion, or $1.128 billion.

Determining the value is considered a key step in the process of equitization. At the April cabinet meeting early this week, Minister of Transport Dinh La Thang asked the Prime Minister to approve the above report to enable Vietnam Airlines to finalize its detailed IPO plan.

Vietnam Airlines CEO Minh says, if the report is approved by the Prime Minister, Vietnam Airlines can complete the equitization plan (including plans for charter capital) this May. "It is almost a certainty that the parent firm will hold the IPO and the shareholders` meeting in the second half of 2014," he confirms.

"Given that there is no precedent for the valuation of an airline in Vietnam, there are many matters that current law cannot address. Therefore, we have to hire foreign consultants to apply international standards and we need the Prime Minister’s approval," Minh explains.

Vietnam Airlines is also finalizing its equitization plan to submit to the Ministry of Transport. "This plan does not change much. We anticipate that after the IPO, the state will hold about 70-80 percent of the capital. But this proportion must also be decided by the Prime Minister," says Minh.

Previously, Deputy Minister of Transport Nguyen Hong Truong said the Ministry aimed to perform Vietnam Airlines’ IPO this September.

Related to the valuation of its fleet (including aircraft owned by the airline and rented aircraft), the value is set at VND37,600 billion by March 31, 2013, compared to the cost of VND53 trillion.

US$1 = VND21,000

Na Son


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