|Passengers board a Vietnam Airlines plane. The carrier is speeding up divestment of non-core businesses. — Photo vietnamdomesticflights.com
HA NOI (VNS) — Vietnam Airlines is speeding up divestment of non-core businesses.
Dau tu (Viet Nam Investment Review) newspaper reported that the carrier's divested amount totalled VND505.64 billion (US$23.19 million) in terms of face value of shares, accounting for about 85 per cent of all values intended for withdrawal.
On July 7 alone, the company sold its entire stake worth VND100 billion ($4.59 million) in the Viet Nam Aviation Insurance JSC in an auction for VND109.55 billion ($5.03 million).
The firm has basically pulled out of "sensitive" sectors such as banking and finance and property, selling its stakes in Techcombank, Hoa Binh Securities, Bao Minh Insurance and Vietnam Airlines Investment.
Phan Xuan Duc, deputy general director of the carrier, said it would sell its stakes in businesses involved in printing, postal services, transportation, construction and plastic production this year.
Of these firms, Airport Engineering Consultancy and Services last year paid a dividend of 16 per cent while Aviation Printing paid 13.58 per cent and Aviation High Grade Plastic, 12 per cent.
Their satisfactory business results would help sell them off on schedule, he said.
However, Vietnam Airlines faces difficulties selling the Aviation Hotel JSC, which has yet to build a planned four-star hotel in HCM City though it was established nearly 10 years ago.
The airline owns 44 per cent of the company's equity of VND96 billion ($4.40 million). Due to problems related to the progress of the project, it failed to divest from Aviation Hotel last year as instructed by the Ministry of Transport. Now the divestment must be completed this year.
According to Duc, after withdrawing from other areas, Vietnam Airlines will retain interests in 18 businesses that are mainly in aviation transportation.
But this may not be the final figure as the company is still continuing to review its investment portfolios.
"We will complete the task in Q3 2015," he said.
Vietnam Airlines has also urged its affiliates as well as companies in which it owns a majority stake to sell off inefficient businesses.
The Viet Nam Air Petrol Company Limited has been asked to sell its stakes in the Nha Be petroleum storage company and Jetstar Pacific Airlines in Thang Long Investment and the Jupiter logistics firm.
The Noi Bai Airport Services Company is also to withdraw from the taxi business.
Vietnam Airlines became an equitised company on April 1 this year. — VNS