Stellar IPO deals expected in 2019

MobiFone will be one of the most anticipated IPOs in 2019

In the first half of 2018, Vietnam saw bustling IPO deals, with PV Power, PV Oil, and EVN Genco 3 succeeding, while in the second half the IPO picture will likely be quieter. Instead, the IPO market promises to become exciting in 2019 with the return of EVN Genco 1 and 2 as well as the joining of MobiFone and VNPT.

MobiFone

According to the initial plan, Mobifone was supposed to complete its equitisation this year, however, it was held up by a number of problems in its mergers and acquisitions (M&A).

The government assigned the Ministry of Information and Telecommunications to help MobiFone complete the IPO in 2019 and build an equitisation plan to submit to the government for approval. Accordingly, in the equitisation plan, Mobifone has to clarify the need for strategic investors, the divestment ratio, as well as build criteria to select strategic investors.

However, in July the Ministry of Public Security’s Investigation Police Agency (C46) launched criminal proceedings against violations relating to Mobifone’s purchase of 95 per cent of the shares of Audio Visual Global JSC (AVG).

C46’s statement was predicted to impact the equitisation process of MobiFone.

According to its financial statement, in the second quarter alone, Mobifone reached VND17.23 trillion ($762.39 million) in net revenue, down 8 per cent on-year, while after-tax profit decreased by 26 per cent on-year to VND1.95 trillion. The firm currently has a charter capital of VND15 trillion ($663.7 million).

Vietnam Posts and Telecommunications Group (VNPT)

According to Decision No.2129/2017/QD-TTg of the prime minister approving VNPT’s restructuring plan in 2018-2020, the group will have to complete the equitisation in 2019.

Most recently, Pham Duc Long, general director of VNPT, stated that the group is trying to complete to evaluate the land fund as well as other assets by the end of the third quarter of this year and then evaluate the firm’s valuation.

According to the plan, the group will conduct the IPO by the end of next year by putting a 35 per cent stake on sale to investors.

EVN Genco 1 and 2

Electricity of Vietnam (EVN) submitted to the Ministry of Industry and Trade (MoIT) its plan as well as the schedule of the equitisation of Power Generation Corporation 1 and 2. Besides, the MoIT also seeks approval from the government to conduct the IPO on January 1, 2019.

At present, EVN Genco 1 and 2 have a charter capital of VND17.94 trillion and VND11.16 trillion ($793.8 million and $493.8 million), respectively.

Previously in February 2018, EVN Genco 3 organised an auction to put 267 million shares on sale. 331 investors won the auction, including 329 individuals and two investors. After the auction, only 7.45 million of the 267 million offered shares were sold at the average selling price of VND24,802 ($1.09) per share, with the highest and lowest selling prices being VND34,000 ($1.50) and VND24,600 ($1.16). EVN Genco 3 acquired VND184.8 billion ($8.14 million) in proceeds.