Vietnam Airlines confirms IPO plan for 2013, targets foreign investors

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Báo Thanh Niên English - 34 month(s) ago 10 readings

National carrier Vietnam Airlines plans to conduct an initial public offering (IPO) no later than the end of next year, with 70-80 of its stake remaining with the state, a newspaper reported Friday.

The plan is part of a larger restructuring roadmap for the carrier, which aims to become Southeast Asia’s third-biggest airline in 2015, according to Dau Tu, a newspaper published by the Ministry of Planning and Investment.

The IPO is expected to raise US$200 million. “This target can only be reached if the company can attract foreign investors,” a senior official was quoted as saying in the report.

Vietnam Airlines plans to retain two of its subsidiaries – technical service provider VAECO and jet fuel supplier VINAPCO – and withdraw from other non-airline sectors, including banking and insurance.

The divestment is expected to bring back another VND530 billion ($25.48 million) for the company, according to the plan.

Chief Executive Officer Pham Ngoc Minh said at a briefing in Hanoi last month that Vietnam Airlines will postpone plans for an IPO until the second half of next year from the original schedule of this year as the “market is not yet attractive to investors.”

The carrier has announced plans to receive 26 A321 planes by 2014 and it intends to order A320 neo-family planes for deliveries after that. It will also get 19 Boeing 787-9 Dreamliners and 14 Airbus A350s beginning in 2015.

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