Viet Nam Mobile Telecom Services Corporation (Mobifone) and multimedia company Audio Visual Global (AVG) signed an agreement on Tuesday to officially terminate the acquisition deal between the two companies.

The move was made to comply with the order of Deputy Prime Minister Truong Hoa Binh and the Ministry of Information and Communication after the Government Inspectorate founded that Mobifone’s acquisition of a 95 per cent stake in AVG broke regulations and led to a loss of around VND7 trillion (US$304 million) in State capital.

According to the agreement, Mobifone will be refunded a total of VND8.775 trillion, including the entire sum worth VND8.445 trillion it had paid AVG for the 95 per cent stake in the struggling multimedia company and other costs.

Mobifone will return 344.6 million shares to AVG shareholders.

The acquisition deal, conducted in late 2015 and announced in January 2016, became a criminal case after the Government Inspectorate found that Mobifone had violated regulations in the acquisition, especially in the assessment of AVG’s financial situation. This caused a loss worth an estimated VND7 trillion because AVG was in difficulty with an accumulated loss of more than VND1 trillion, and was not in as good a situation as Mobifone reported in the acquisition.

On March 12, the two companies agreed to cancel the deal several days before the inspection results were announced.

Mobifone said that in the future the company would focus on developing infrastructure for network expansion, restructuring its organisation and improving its business efficiency. — VNS