VIMC to divest state stake to 65 per cent

April 21, 2024 | 09:32
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Among the developments at Vietnam Maritime Corporation's (VIMC) AGM on April 16 was the agreement from the shareholders to reduce the state's ownership from the current 99.46 per cent to 65 per cent to encourage future development of the company.

VIMC is currently a state-owned enterprise under the management of the Commission for Management of State Capital at Enterprises (CMSC). The issuance of shares to increase capital will give priority to existing shareholders and to partners specialising in container transportation to aid in developing more services.

VIMC to divest state stake to 65 per cent

According to the corporation's approved development strategy, VIMC will implement synchronous investment and development projects in all three main business areas, deep-water seaports in Lach Huyen, Lien Chieu, and Can Gio; investing in a fleet of container vessels; and the development of logistics infrastructure with a total investment of about VND43.2 trillion ($1.8 billion). The expected disbursement value for the period 2021-2025 is about VND31.8 trillion ($1.32 billion), with VND12.25 trillion being equity capita

Meanwhile, VIMC's current assets are mainly concentrated in fixed assets (ship fleet) and long-term financial investments.

“Therefore, increasing VIMC's charter capital is necessary to meet VIMC's investment and development needs to take advantage of resource opportunities to expand business activities (investing in development of ports for large tonnage ships, investing in fleet development, investing in increasing capital in subsidiaries with effective business activities, among others), in accordance with VIMC's strategic development orientation," said Nguyen Canh Tinh, general director of VIMC.

Also at the meeting, VIMC's shareholders approved the Board of Directors' proposal on updating VICM's restructuring plan for the 2021 - 2025 period, including the capital investment policy of establishing a joint venture between VIMC and Aries Energy Corporation (Greece).

This joint venture operating in the field of freight agency, warehousing and logistics services is expected to have a charter capital of $200,000, of which VIMC contributes $102,000, equivalent to 51 per cent of charter capital and Aries Energy Corporation contributes the remainder, equivalent to 49 per cent of charter capital.

According to the updated restructuring plan, VIMC will invest in a series of inland container depots (ICD)/depot projects in key economic areas such as Ninh Giang logistics centre, inland waterway port; contribute investment capital to implement the Cai Mep Ha container port project (VIMC plans to contribute 30 per cent); establish a joint venture to implement the logistics infrastructure investment project in Bac Ninh province worth $22.1 million.

At the meeting, the company’s business plans for 2024 were agreed by shareholders. Accordingly, VIMC aims to achieve sea transport output of 15.9 million tonnes, equal to 76 per cent compared to 2023); output of goods through its ports is 123.6 million tonnes, up 8 per cent from 2023; and consolidated revenue reached VND13.45 trillion ($560.41 million); and profit before tax reached VND2.73 trillion ($113.75 million).

VIMC, however, admitted that it still faces challenges because the global shipping market in 2024 is forecast to continue to be difficult, driven by tension escalations in some countries, Drought in the Panama Canal. In addition, units have plans to liquidate old ships with inefficient operations, and poor technical condition.

In the Vietnamese market, the trend of increasing ship sizes, especially for ships going to Europe (the largest ship size is more than 24,000 TEU), can lead to loss of opportunities for VIMC ports such as SSIT and CMIT, SP-PSA.

VIMC also faces other challenges of having old ship fleet. Meanwhile, its plan to develop new fleet cannot do due to barriers related to investment procedures.

VIMC seaports is under increasing pressure from the private sector as well as the openning of many new ports in areas that have more advantages than VIMC's port locations, and others.

In order to carry out the tasks and plans for 2024, VIMC is determined to maintain the market share, and keepcustomers, attract talents, apply advanced technology, and prioritise key projects.

The company gradually transforms green, develops a new-generation transport fleet, build a modern seaport system to ensure compliance with regulations and standards, aiming for growth and sustainable development.

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By Bich Thuy

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