The Government will divest its stake in Vinamilk this year. — Photo VNA/VNS

HÀ NỘI – The Government will divest its stake in Vietnam Dairy Products JSC (Vinamilk) this year, a senior official from the Ministry of Finance told a press briefing on Wednesday.

Deputy Director of the finance ministry’s Department of Corporate Finance Đặng Quyết Tiến said besides Vinamilk, the Government will also sell its stake in nine other leading State-owned enterprises (SOEs) early next year as part of the country’s new economic strategy.

Tiến did not reveal details about the Vinamilk divestment, saying that the sovereignty wealth fund State Capital Investment Corporation (SCIC) is preparing the plans to be submitted to the Ministry of Finance and the Prime Minister soon.

He, however, said the divestment process must be executed carefully to avoid any negative impact on the stock market as investors might focus entirely on Vinamilk. The State ownership in Vinamilk is huge, valued at nearly VNĐ100 trillion (US$4.46 billion), he said.

The Government may choose to sell the stake gradually, in portions that can be easily absorbed by the market, he said, assuring that the sale will be in accordance with the country’s legal regulations and transparent to ensure interests of the State and the investors.

The Government currently holds 45.1 per cent stake in Vinamilk. At present, Vinamilk’s largest foreign shareholder is F&N Dairy Investment, part of the Fraser and Neave conglomerate, with 11 per cent. The firm is controlled by Thai beer tycoon Charoen Sirivadhanabhakdi, who has been making inroads into Việt Nam via his Thai Charoen Corp.

Vinamilk is one of the country’s most sought-after equities and foreign investors have long been interested in Vinamilk thanks to its strong prospects and expansion plans. Vinamilk’s shares have increased 18 times since the company was first listed in 2006 to VNĐ146,000 per share as of mid-May.

In late June, the board of directors of Vinamilk formally approved the removal of its 49 per cent foreign ownership cap, paving the way for an expected surge of interest from overseas investors in the local company.

Late last year, SCIC unveiled plans to sell the state’s holding in 10 leading SOEs, which could earn it a total of $3 billion.

The enterprises are Vinamilk, Bao Minh Insurance Corp, Vietnam National Reinsurance Corporation and Tien Phong Plastic JSC, as well as Binh Minh Plastic JSC, Vietnam Property and Infrastructure JSC, FPT Corp and FPT Telecom, along with Ha Giang Mineral Mechanics JSC and Sa Giang Import Export Co. — VNS