A Vinawaco ship. The company has found a way to settle a VNĐ53.1 billion debt with the largest-valued lender Vietcombank. — Photo baodautu.vn

HÀ NỘI — The Waterway Constructions JSC - Vinawaco plans to offload State shares to pay a debt owed to the country's largest lender by market capitalisation, Vietcombank.

Vinawaco borrowed VNĐ12.59 billion (US$1.15 million) in 1995 from the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) to buy three ships from the State-owned Vietrancimex.

Vietrancimex was a State-owned shipping company and the deal aimed to help it tackle financial difficulties.

After acquiring the ships, Vinawaco suffered cumulative losses and almost had to declare bankruptcy. The company was then equitised in 2013 and the State capital was cut to 36.62 per cent in September 2016.

In the same month, Vietcombank asked Vinawaco to pay a debt worth VNĐ53.1 billion, which included the initial loan worth VNĐ12.59 billion, interest and late-payment penalties.

The lender’s demands came unexpectedly for the company, its strategic investors and shareholders, according to Vinawaco Chairman Ngô Văn Tuấn.

Prior to Vietcombank’s request, Vinawaco had removed the debt and interest from its accounting records since 2005 as it misunderstood requests made by the Prime Minister and the State Bank of Việt Nam about the ships during the equitisation progress.

So the valuation of Vinawaco did not include Vietcombank’s loan and interest.

The problem between Vietcombank and Vinawaco worsened when the latter said it would not pay the debt because it had not recorded it in financial reports and corporate valuation records.

In addition, Vinawaco had not completed its switch to a joint-stock company from a State-owned enterprise as it had not obtained confirmation from State agencies.

To settle the dispute, the Ministry of Transport has asked the Prime Minister's permission to hand over Vinawaco and its assets to the State Capital Investment Corporation (SCIC), which include Vietcombank’s debt. The SCIC would then have to sell part of the State capital at Vinawaco to settle the debt with Vietcombank.

Other missing debts

Since Vietcombank’s debt was reported, Vinawaco has discovered 14 other outstanding loans worth VNĐ137 billion after reviewing financial reports of seven subsidiaries.

Those debts were neither recorded in the corporate valuation when the firm was equitised nor valued accurately. Vinawaco has come up with solutions to settle the debts with other lenders. — VNS