Aéroports de Paris to become ACV strategic investor

Wednesday, Mar 09, 2016 21:42

A corner of the Tân Sơn Nhất airport in HCM City. The Airports Corporation of Việt Nam plans to sell a 7.4 per cent stake to a French partner. — Photo doisongphapluat.com

HÀ NỘI (Biz Hub) — The Airports Corporation of Việt Nam (ACV) plans to sell some 166 million shares to French airport authority Aéroports de Paris (ADP), which is set to become a strategic investor.

ACV, the largest enterprise in Việt Nam's transport sector, said in a draft resolution prepared for its first shareholders' meeting next Wednesday in HCM City that the initial price of the shares are expected to be VNĐ13,100 (58 US cents) each.

With such share volume and price, ADP will hold some 7.4 per cent of ACV's total equity of VNĐ22.4 trillion. If the agreement is successful, the French company will be restricted in transferring its shares for at least 10 years.

ACV Chairman Nguyễn Nguyên Hùng told the press in January that ADP was the only investor, at that time, that met the requirements of the Ministry of Transport to conduct negotiations in the role of a strategic partner.

Other organisations that proposed, but failed, to become strategic investors of ACV were Changi Airport International, a subsidiary of Singapore's Changi Airport Group, and the Bank for Investment and Development of Việt Nam.

After launching an initial public offering on the HCM City Stock Exchange last December, ACV announced it would offer strategic investors a 20 per cent stake. This means a remaining stake of 12.6 per cent is still available for other investors.

Meanwhile, industry insiders said ANA Holdings Inc, owner of Japan's largest airline, All Nippon Airways, might be the next potential strategic investor of ACV.

Japan has expressed interest in the VNĐ336.6 trillion Long Thành international aviation terminal, which will be developed by ACV in southern Đồng Nai Province, following the government's designation. Japan is reportedly considering funding the terminal with government capital set aside for development assistance.

Additionally, national flag carrier Vietnam Airlines has also decided to sell an 8.8 per cent stake to ANA Holdings at an estimated price of nearly $109 million, and the agreement is expected to be concluded in June.

In another statement, ACV said concentrating resources for Long Thành development will be one of its business strategies for the next five years. The company will mobilise VNĐ114.5 trillion to complete the first phase of the terminal by 2025.

Between 2016 and 2020, the company projects passenger growth rates of six to eight per cent per year at its airport system. Also, it expects annual growth rates in freight to reach some five per cent.

This year, it plans to report total revenues of VNĐ12.1 trillion, with revenues from services increasing 5.1 per cent over last year. It is set to pay dividends at a rate of five per cent, with pre-tax profits expected to reach VNĐ2.1 trillion.

The company also plans to spend no more than VNĐ5.8 trillion on infrastructure upgrades at half of its 22 nationwide airports this year, including major terminals in Hà Nội, HCM City and central Đà Nẵng City.

Currently, the State retains a stake of 75 per cent in ACV.

Vũ Anh Minh, the director of the transport ministry's enterprise management department, told Vietnam News Agency last November that the State's stake in ACV would be reduced from 75 to 65 per cent "at a suitable time".

The reduction would depend upon the government's calculations in retaining its stake in the company, and the need for capital to assure progress in the Long Thành project, he said. — VNS

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