Vietnam Moves to Equitize Huge State Companies

Vietnam plans to sell stakes this year in some of its leading government enterprises — including telecom giant MobiFone, the country’s top oil product distributor Petrolimex, and the state bank for investment and development (BIDV).

The sale of state-owned enterprises (SOEs), which also include textiles and steel corporations, is part of Vietnam’s effort to restructure the state sector that began in 1992 and now is expected to be completed 2015.

Sale of shares in MobiFone, valued at $2 billion, had been scheduled for the second quarter of 2009 but was delayed. BIDV, the second-largest lender after state-run Agribank, has been scheduled to be partially sold for years.  Hanoi-based Petrolimex commands 55% of Vietnam’s retail fuel market.

The public offerings in these companies would seem to be a big opportunity for foreign investors, which may be true in the long run.  However investors have learned the hard way that some recent IPOs in Vietnam have been overpriced.

More on equitization of Vietnam’s large SOEs

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