HA NOI (VNS) — A draft regulation about allowing State-owned enterprises (SOEs) to sell stakes in non-core businesses at below the face value would be presented to the Prime Minister for approval.
This is part of the efforts to accelerate the SOEs' restructuring process. According to Deputy Director of the Department of Entrepreneurial Finance Dang Quyet Tien, the decision about speeding up capital withdrawal from non-core business in the 2013-15 period was now being evaluated by the Ministry of Justice and would be submitted to the Prime Minister this month.
Tien said that the regulations would tackle the problems which the SOEs were encountering during the capital withdrawal process, while preventing losses to the State assets.
Nguyen Duc Tang, an expert in equitisation, was quoted by Dau Tu Chung Khoan (Securities Investment) newspaper as saying that the sale of stakes below the book value, in fact, did not conflict with the market principle as the investments were inefficient.
What's important was to ensure transparency during the capital withdrawal process in order to prevent losses to the State assets.
The transparency must be there right from planning, auctions and prices to the buyers, he said.
According to the Department of Entrepreneurial Finance, the plan and progress of the State's capital withdrawal from non-core fields must be approved by the relevant authorities.
Then, the share transfers would be conducted under trading on stock exchanges, public auctions or direct deals.
The restructuring of SOEs is currently underway in Viet Nam. However, the process has been going slow. Statistics from the Steering Committee on Corporate Renovation and Development showed that SOEs, to date, managed to withdraw around VND4.164 trillion, or US$198.28 million, from their non-core business, comprising 19 per cent of the total non-core investments. — VNS