Vinacomin discloses blueprint for overhaul

March 06, 2013 | 16:26
Vinacomin, Vietnam’s largest state-owned mining group, has disclosed a plan to divest a series of its non-core business holdings by 2015 in accordance with the government-ordered overhaul of the state-owned sector.

According to the approved restructuring plan of the Vietnam National Coal and Mineral Industries Group (Vinacomin) in the 2012-2015 period, the group will concentrate its efforts on  four main business lines: the coal industry, mineral- metallurgy industry, industrial explosives, and electrical industry.

Under the plan, the group will divest its capital from nine companies in sectors of construction, banking and finance, including SHB-Vinancomin Insurance Company, Vinacomin Finance Company, Saigon-Hanoi Commercial Bank, Vinacomin Infrastructure and Housing Development Company, BIDV-Vietnam Partners Investment Management, Vietnam National Aviation Insurance, Saigon-Hanoi Securities and Hanoi Economic Zone Development JSC.

The group will also dissolve two subsidiaries - namely Dong Vong Coal Company and Vietnam-Japan Gemstones Company - as well as allow for the bankruptcy of Song Ninh-Vinacomin Shipbuilding Limited Company. Under the plan, Vinacomin will be a parent company with 16 dependent entities. The mother corporation will hold 100 per cent of its stake in five subsidiaries, maintain 65-75 per cent of the registered capital in nine companies, and  reduce its stake to 50-65 per cent in another 11 companies, while owning less than 50 per cent of registered capital in 11 others.

Vinacomin is one of many big state-owned groups which the government required divest capitals from all non-core business sectors before 2015 due to inefficient investment, resulting in  major uncollected debts for many years. Under the government’s report on the financial condition and business operation of 91 state-owned corporations and groups in 2011, Vinacomin is one of five enterprises with biggest problem of bad debts, totaling $16.9 million. Others include PetroVietnam with $19.6 million and the Song Da Group with $17.6 million.

Last year, Vinacomin divested from two companies, BIDV Expressway Company and SVIC Insurance Company, with respective value of VND9.5 billion ($456,730) and VND50 billion ($2.4 million). In 2012, the group’s revenue grossed VND95.5 trillion ($4.2 billion), equal 105 per cent of the adjusted full-year plan and 88 per cent of the 2011 result, including $1.1 billion from coal exports. The profit reached VND2.8 trillion ($134 million), equal to 33 per cent of the 2011 result.

Vinacomin has targeted revenue at VND105 trillion ($5.2 billion) in 2013, up 15 per cent from 2012, profit at VND2.5 trillion ($120 million), equal 89 per cent of 2012.

By Nguyen Trang

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