FPT to ring in big telco profits

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Báo Đầu Tư English - 29 month(s) ago 5 readings

FPT to ring in big telco profits

FPT is ramping up efforts to dial into telecom sector profits.

FPT's leadership has just unveiled a plan to procure all state capital contributions in FPT Telecom, currently represented by the State Capital Investment Corporation (SCIC).

FPT holds a 40.43 per cent stake in FPT Telecom, while SCIC retains 50.15 per cent.

In the past six months, FPT leaders met with SCIC counterparts several times to make OneFPT a reality as it had handled with FPT Software, FPT IS and FPT Trading in 2011, said FPT's chief executive officer Truong Dinh Anh.

Anh said SCIC's Member Council was in the process of valuating FPT Telecom and devising meticulous plans on the purchase, which will be handled through share swapping or cash payment.

"From FPT's part, the higher FPT Telecom's valuation the better, but the final response is pending on the part of SCIC who gets a ruling 50.15 per cent stake in FPT Telecom," said Anh.

FPT executives expected they could wrap up the deal within 2012.

Deputy Minister of Information and Communications Le Nam Thang said less state firms in the telecommunications field was desirable as a bloated market could undermine firms' production and business efficiency.

Parallel to quickening FPT Telecom's acquisition, FPT is reportedly seeking other viable telecom field purchases as well as waiting to be licenced for the deployment of new technologies like 4G.

"FPT is using every opportunity to grow powerful in the telecom business," said Anh.

FPT financial reports in 2012's first quarter show that telecom services brought in VND658 billion ($31.6 million) revenue, making up 11 per cent of the group's total revenue and tantamount to 17 per cent of the distribution sector's revenue.
It generated VND186 billion ($8.9 million) in profits, equal to 29 per cent of the group's total.

In 2011's financial year, telecom services contributed VND801 billion ($38.5 million) profits, equal to 31 per cent of the group's total.

Anh said the telecoms segment had made a huge leap forward in 2011 as during 2009-2010 the group opened new branches in 30 provinces and municipalities throughout the country and around half of them enjoyed profits in 2011.

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