HCM City set to divest from 40 SOEs by year 2020

Saturday, Jan 21, 2017 08:30

Staff of Sai Gon Travel Corporation (Saigontourist) welcome foreign visitors to Viet Nam. — VNA/VNS Photo Trang Duong

HCM City will have to divest from 40 State-owned enterprises (SOEs) between 2016 and 2020, reported cafef.vn.

The 40 SOEs are now being directly managed by the HCM City People’s Committee.

They are also among 240 State-funded companies that were enlisted early this month by Prime Minister Nguyen Xuan Phuc, in which the government needs to make divestments between 2016 and 2020.

Among those 40 firms, the southern economic hub is allowed to maintain its total control of HCM City Finance and Investment State-owned Company (HFIC).

The HFIC may be considered a “minor State Capital Investment Corporation” in HCM City, which holds State capital in several large-cap companies such as HCM City House Trade Management Co Ltd, Gia Dinh Textile and Garment Company, and Cho Lon Investment and Import Export Corporation.

Among the other 39 SOEs that will be equitised, HCM City will hold the controlling stake in three firms with the ownership of between 50 per cent and 65 per cent of the company’s chartered capital. The three companies are Sai Gon Industry Corporation (CNS), 27-7 HCM City Co Ltd, and HCM City Greenery Parks Co Ltd.

The southern city will hold less than 50 per cent of chartered capital in the rest of the targeted SOEs, including 24 community services providers and other key corporations.

Among those companies, Saigontourist Holding Company (Saigontourist), Sai Gon Trading Group (Satra), Sai Gon Transportation Mechanical Corporation (Samco), and Sai Gon Water Corporation (Sawaco), in addition to Sai Gon Jewelry Company (SJC) are expected to draw the attention of many investors for their equitisation as they have a good reputation, business scales and influence in the city and across the country.

Satra is one of the largest food trading corporations in Viet Nam whose total revenue each year could reach trillions of dong. The company is developing its food retail chain, having established more than 100 Satrafood stores, and the company will expand the chain in 2017.

Satra also possesses stakes in some big food and beverage companies, including Vissan – the leading company in raw and frozen meat production and trading – and Heineken Viet Nam – the second largest brewer in the country, which contributes a yearly income of VND2 trillion for Satra.

Saigontourist is one of the leading groups in the tourism sector, operating hotel, restaurant and travel businesses. The group also owns many hotels in HCM City.

Samco is an SOE that operates in various fields with the core businesses being production of transport mechanic outputs, transportation and supply of transport services. The corporation also distributes automobiles, provides branded auto parts and maintenance services for auto users.

SJC is among the leading jewellery traders in Việt Nam, along with Phu Nhuan Jewelry Joint Stock Company and Doji Gold and Gem Group. The corporation owns 23 branch companies, six subsidiaries, six affiliates and invests in 13 other businesses. SJC has a distribution network made of 200 stores and more than 3,000 affiliate stores in the country.

Sawaco mainly operates in production and selling of clean water in HCM City. The company has the monopoly over the distribution and management of clean water in the city’s region. — VNS

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