Petrolimex’s IPO off limits to foreigners

July 12, 2011 | 14:00

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Foreigners will not be allowed to bid for giant Petrolimex’s upcoming initial public offering, due to the government’s energy security policies.

The regulation was emphasised by the company Tuesday in its roadshow promoting its IPO to take place on July 28. In Petrolimex’s prospectus, the oil importer and distribution also required investors “being domestic institutions and individuals” to be eligible to join the shares auction.

The restriction was explained by Deputy Minister of Industry and Trade Nguyen Cam Tu – head of Petrolimex’s equitisation steering committee – as the company doing business in oil sector that “is a special sector having impact on energy security”.

“At the moment, our business is still in its initial stages and remains fledging,” he added.

Vietnam had just laid down to move gasoline prices towards market prices since late 2009 via Decree 84/2009/ND-CP, on petroleum trading mechanism. However, the government has still adjusted the home oil price at some specific times since then.

Also, Petrolimex has no plan to sell its stake to foreign partner “at least within this year,” said the company’s general director Bui Ngoc Bao.

“Our current technique and resources are adequate for the company’s projects,” Bao said. “We might consider [seeking foreign partners] if we take on further projects that need better techniques.”

However, the minister said foreigners could buy into the state-run oil firm in the future.

“Vietnam will also have to open its gasoline sector,” said Tu. “We not completely restrict foreign investors but we have to choose the appropriate times.”

By Hai Linh

vir.com.vn

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