VietNamNet Bridge - The country’s largest telecommunications group VNPT plans to push ahead the equitisation of its key affiliates this year.

Acting VNPT Group CEO Pham Long Tran said Vietnam Datacommunication Company (VDC) and the Vietnam Software and Media Company (VASC) had been asked to compose equitisation proposals to seek government approval, allowing VNPT to conduct the equitisation process itself in the future.

VDC would shift the national transmission backbone businesses to VNPT and separate VnMedia from the company along with the Vietnamnet online newspaper. The equitisation would occur within the companies’ service sectors, including software, online supermarkets, games and value-added services.

VNPT previously intended to convert VDC and VASC into limited companies with one member, in which VNPT would hold 100 per cent of the chartered capital. However, the group’s operational model had changed and it would now only keep the national backbone businesses. “We will conduct the equitisation of the entire group once all preparations are complete,” said Tran.

VNPT, meanwhile, did not mention any process for the equitisation of its second mobile operator, VinaPhone, in this year’s equitisation plan, but reported that it had finished technical proposal gradings for financial consulting bidders concerning its first mobile operator to be equitised, MobiFone.

The group would also ask the government this year to execute the equitisation of its postal financial company, its fibre optic cable company, Focal, and its postal printing company.

The equitisation process would continue to divert three out of the group’s eight production joint ventures into joint stock entities, including Focal, VinaLSC and Vinadaesung, while also converting the Vietnam Postal Saving Company into a commercial bank this year.

Among these, VDC ranked the fifth-largest for revenues by a service affiliate of VNPT, excluding the group’s telecom arm in provinces and cites. The company earned VND824 billion ($51.5 million) in net revenue in 2007.

All VNPT affiliates had experienced better business results after equitisation. By the end of 2006, the annual revenues of the equitised companies were VND5.3 trillion ($331.2 million), doubling that of pre-equitisation. Net profits also increased by nearly 60 per cent in 2006.

VNPT finished the equitisation process of its 20 affiliates during 2005-2007, raising its total number of equitised entities to 39.

VNPT group secured net revenues of VND45.3 trillion ($2.8 billion) in 2007, a year-on-year increase of 14 per cent against those of 2006. Sixty per cent of these revenues came from its two mobile operators, MobiFone and VinaPhone.

(Source: VIR)