Vinalines drops plan for PPP port investment

March 12, 2013 | 15:19

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The state-run Vietnam National Shipping Lines is going to withdraw from the northern Vietnam’s flagship port project Lach Huyen as part of its divestment activities.

A company’s source said Vinalines would withdraw from the joint-venture that invests in two container wharfs under International Gateway Lach Huyen Port’s first stage, piloted as a public-private partnership (PPP) in order to focus on its restructuring plan period 2012-2015.

Specifically, the Ministry of Defense-backed Saigon Newport Corporation will replace Vinalines to become Japan-invested MOLNYKIT’s partner in a two member joint stock company with charter capital of $30 million, the source said.

Earlier, Vinalines committed to contributing a 51 per cent stake in a joint venture contract signed at the end of 2011. Apart from Lach Huyen port, Vinalines will withdraw its capital at three other Cai Mep-Thi Vai based joint venture seaports.

Vinalines will divest and let its subsidiaries go bankrupt over the next two years, according to a restructuring scheme that has been approved by Deputy Prime Minister Vu Van Ninh.

After the restructuring is completed, Vinalines will concentrate on its core business, including shipping, port operations, and shipping services.

To tackle its financial difficulties, Vinalines will have to let its member units Vinashinlines and Vietnam Oil and Gas Transportation Co (Falcon) dissolve. Vinalines will also dissolve two other units, its branch in Can Tho City and the Asian Maritime Human Resources Centre Joint Venture (Vina-STC).

By the end of 2015, Vinalines will have to completely divest from 37 other businesses, and merge others so that they can be equitised later. After this restructuring, Vinalines will only hold 100 per cent stake in two businesses, and 50-75 per cent stakes in 30 other businesses.

Meanwhile, Saigon Newport Corporation, a holding company, operates the most modern, professional and biggest container terminal in Vietnam with the seaport.

International Gateway Port Lach Huyen, once completed in 2016, is expected to be able to accommodate vessels of up to 100,000 dead weight tonnes for Trans-Pacific route. The port will help reduce logistic costs to the US market.

Currently, Lach Huyen project has almost completed all procedures including capitalising for its starting stage.