Slight advantage decides Vinamotor race

January 11, 2016 | 18:00

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Vietnam N.A Motor Co., Ltd (N.A Motor) has overtaken TN Development Joint Stock Company (TN) in Vietnam Motors Industry Corporation (Vinamotor)’s second auction to purchase the state’s 97.7 per cent stake.

Photo source : cafeF.vn

On January 11, the Ministry of Transport (MoT) has conducted an auction to sell 85.6 million state-owned Vinamotor shares, equalling 97.7 per cent of the total stakes, at the initial price of VND14,612 ($0.64) per share.

Both N.A Motor and TN bid aproximately VND1.25 trillion ($55.8 million) for the whole batch of 85.6 million shares at the price of VND14,600 ($0.64), however, N.A Motor won by offering VND2 million ($89.2) higher thanTN.

N.A Motor and TN are the only two bidders meeting the MoT’s requirements to join in the auction.

Previously, Vinamotor failed painfully in its IPO in March 2014. It announced the auction of 51 million state-owned shares for an initial price of VND10,000 ($0.47) per share, however, only 3.1 per cent of the shares were taken up, falling incomparably short of its original expectations, acquiring only VND15.7 billion ($735,370).

Vinamotor’s second share auction was organised in the context of the auto industry’s accelerating development and the approval to sell the entire state-owned stake. The changes made the auction more attractive, despite the higher initial price.

Established in 2005, N.A Motor specialises in distributing cars and motorbikes, selling spare parts, vehicle insurance, as well as providing vehicle maintenance and repair. The company is currently expanding its operations to the real estate sector. N.A Motor, with its solid finances, commits to make Vinamotor the country’s leading car manufacturer and distributor. As of June 2015, the company has a total equity of VND1.11 trillion ($49.1 million).

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