Ô Môn Thermal Power Plant, managed by EVNGENCO 2. The company is expected to conduct an IPO in December this year. — Photo tapchicongthuong.vn

HÀ NỘI — The value of the Power Generation Corporation 2 (EVNGENCO 2), a subsidiary of Vietnam Electricity, has been determined at VNĐ46.1 trillion (US$2 billion) as of January 1, 2019, of which the real value of State capital is more than VNĐ26.6 trillion.

The company’s valuation, used for its equitisation process, was announced by the Commission for the Management of State Capital at Enterprises on Tuesday.

Assets not included in the enterprise’s value are fixed assets formed from the reward and welfare fund with the remaining value of VNĐ 5.7 billion which was transferred to the trade union organisation to manage and use for the benefits of employees in the company.

The valuation is calculated by the auditing and tax consulting firms AASC and UHY based on financial statements audited by KPMG.

According to Hồ Sỹ Hùng, vice chairman of the commission, enterprise valuation is the first step during the equitisation process with the hope of providing the public information in a transparent manner to attract investors to a future IPO.

The result was reviewed carefully based on publicity, transparency and democracy in compliance with the law and supervised by assistance teams from the equitisation steering committee and tax agency with the approval of land use plans of the People’s Committees of relevant provinces and cities and audited by the State Audit Office of Việt Nam, Hùng said.

EVNGENCO 2 is among the six State corporations due for equitisation this year.

The company was established in 2012 with a charter capital of VNĐ11.7 billion. Vietnam Electricity (EVN) holds 100 per cent of its charter capital

Nguyễn Xuân Nam, EVN’s deputy general director, on Tuesday pledged to take drastic measures to complete equitisation on schedule.

“This valuation is an important step for EVNGENCO 2 to make its initial public offering (IPO) by the end of this year, helping attract investors to participate and contribute to the development of the company,” Nam said.

The Commission for the Management of State Capital at Enterprises has instructed EVN and EVNGENCO 2 to urgently implement the following steps to conduct its equitisation plan, which will be submitted to Prime Minister Nguyễn Xuân Phúc for approval in August.

Its IPO is expected to take place in December this year.

EVNGENCO 2 reported net sales of goods and services in 2019 reached VNĐ27.1 billion, up 16 per cent year-on-year. However, due to interest expenses exceeding VNĐ1 trillion, its after-tax profit was VNĐ3.1 billion. — VNS