Domestic competitors falling out of ACV race

In a proposal submitted to Prime Minister Nguyen Tan Dung in late December, the bank also expressed interest in setting up a consortium with an experienced airport operator appointed by the Ministry of Transport (MoT), to enable it to continue the race to become a strategic shareholder of Airports Corporation of Vietnam (ACV). The lender wants to maintain its 5 per cent contribution to ACV’s chartered capital.

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This has been BIDV's second proposal, following the first made in mid-December, when the bank’s chairman Tran Bac Ha sent a document to the government and the MoT, petitioning to lower the application criteria. As argued by Ha, with the current strict requirements no domestic firm would be shortlisted in the race.

However, there seemed to be little chance for BIDV, as December 31, 2015 was the deadline for the submission of documents by qualified investors.

Also in late December, Imex Pan Pacific (IPP) of US dollar millionaire Johnathan Hanh Nguyen, the second Vietnamese firm in the race, has decided to quit just around 10 days after submitting its proposal of contributing 5 per cent of ACV’s chartered capital to the ministry.

"We chose to withdraw in order to focus on the development of some recently-licensed large-scale projects in Ho Chi Minh City and other localities," stated Johnathan Hanh Nguyen in a document recently sent to the MoT.

In fact, IPP has the chartered capital of only VND2.5 trillion ($110 million). Additionally, its core business line is trading, not airport operation or financial investment, putting the race over ACV lower in its queue of priorities.

Due to the strict equity requirements set by the MoT, requiring equity of at least $2 billion as of the end of 2014 for the potential investor as airport operator, and $5 billion for the investor as financial firm, both IPP and BIDV fall short.

With the withdrawal of IPP, BIDV remains the only domestic investor in the race, which is heating up from strong interest by a number of foreign groups, including France's Aeroport de Paris (ADP), and Japanese investors Taisei and JATCO.

Vu Anh Minh, head of the MoT's Department for Enterprise Management, told VIR that the list of potential investors would be submitted to the MoT for approval in early 2016.