Singaporean investor loses faith in Viwasupco

April 09, 2016 | 16:38

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Singaporean Acuatico Pte. Ltd. has divested its 43.2 per cent stake, equalling 21.8 million shares, in Vinaconex Water Supply Joint Stock Company (Viwasupco) as a reaction to a Chinese contractor’s winning a pipeline contract for a crucial water project at Viwasupco, according to newswire vnexpress.

Previously, Viwasupco planned to invest in Song Da Water Project - Phase II. Chinese pipe maker Xinxing won the contract by bidding 11.8 per cent under the investor’s asking price. Under the VND588 billion ($26.25 million) contract, Xinxing will supply ductile iron pipes for the project’s 21-kilometre pipeline.

However, the selection of the Chinese contractor for a crucial water project faced protest from residents, due to concerns over the quality of the ductile iron pipes.

Acuatico’s decision to divest also came in the context of Viwasupco’s ineffective operation, suffering continuous losses through the 2010-2014 period. In 2015, its revenue increased to VND404 billion ($18.1 million) with a profit of VND147 billion ($6.6 million), due to receiving exemption from paying corporate income tax, but this in itself proved little to brighten its prospects in Acuatico’s eyes.

On November 11, 2010, Vinaconex Joint Stock Company (Vinaconex) completed the transfer of 21.8 million Viwasupco shares to Acuatico. After the transfer, Vinaconex retained 25.5 million shares, equalling 51 per cent of Viwasupco’s total chartered capital.

Founded in 2006, Acuatico operates as an investment holding company that invests in water supply projects.

By By Ha Vy

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