HANOI: State-owned oil giant PetroVietnam has announced a divestment plan for the next five years, after which it will sell majority stakes in a number of its subsidiaries.
In its divestment plan—which was submitted to the Government and Ministry of Industry and Trade — PetroVietnam said it has been seeking investors to reduce holdings in PetroVietnam Petrochemical and Textile Fiber JSC (PVTex) from the current 74-per-cent stake to 36 per cent. “It even allows selling entire stakes if partners are found,” the report said. PVTex, founded in 2008 with a total investment cost of about US$200 million, is the first polyester fiber plant in Việt Nam. The plant uses feed from Dung Quất refinery to produce polyester fiber with a total capacity of 175.000 tonnes per day.
The plant started commercial operation in May 2014 with a capacity of 236 tonnes per day, but it often halts operations due to high inventory and capital shortage. Its charter capital reached VNĐ2.2 trillion ($99 million) by the end of last year. In 2015, PVTex reported total losses of nearly VNĐ1.3 trillion and a negative equity capital of VNĐ504 billion. The company is on the verge of insolvency with huge debts of $221.3 million to lender BIDV and other banks.
PetroVietnam is seeking solutions to rescue the company from a possible bankruptcy and to increase its business efficiency. Apart from PVTex, the energy group has drawn a roadmap plan to divest capital from other subsidiary companies from 2016-20, including PetroVietnam Power Corporation (PV Power), PetroVietnam Oil Corporation (PV Oil), Bình Sơn Refining and Petrochemical Co Ltd and Dung Quất Shipbuilding Industry Co Ltd, in which it holds 100 per cent of charter capital.
PetroVietnam has established equitisation steering committees in these companies and hired consulting companies to calculate their corporate values. It plans to reduce holdings in PV Power to at least 51 per cent of capital, in PV Oil and Bình Sơn Refining and Petrochemical to 65 per cent, and in Dung Quất Shipbuilding Industry to 75 per cent after equitisation.
The oil giant is seeking Governmental approval to maintain a 41 per cent stake in Vietnam Energy Inspection JSC. By the end of 2015, the group sold a VNĐ800 billion investment to Ocean Bank at zero đồng down under the direction of the State Bank of Việt Nam. It also decreased holdings in PetroVietnam Insurance JSC to 35 per cent, in PetroVietnam Transportation JSC to 36 per cent and in PetroVietnam General Service JSC to 24.2 per cent.
