Dung Quat shipbuilding company may declare bankruptcy

Tuesday, Dec 13, 2016 21:02

Dung Quat Shipbuilding Industry Co., Ltd (DQS) may declare bankcruptcy when having huge losses. — Photo vov.vn

Dung Quat Shipbuilding Industry Co. Ltd (DQS) may declare bankruptcy, one of the possible solutions for the company, due to the huge losses it has incurred over the past years.

This was stated in the Ministry of Industry and Trade’s report submitted to the prime minister recently.

Two other solutions are to restructure DQS to resolve its difficulties in production and business or to transfer DQS to other companies to manage. Under the ministry’s report, this transfer would be planned by Viet Nam National Oil and Gas Group (PetroVietnam), the parent company of DQS.

Bankruptcy according to existing regulations is the last choice for DQS, the ministry said.

The ministry reported that DQS was established in 2006 and was a member of Shipbuilding Industry Corporation (SBIC), formerly Vinashin. In 2010, the company was transferred under the management of PetroVietnam.

According to the financial statement as of June 30, 2010, when DQS was transferred to PetroVietnam, the former had chartered capital of VND3.758 trillion and total losses of VND7.44 trillion, including bank loans worth VND4.8 trillion. DQS did not have the ability to pay its debts, vneconomy.vn reported.

When PetroVietnam took over management of DQS, it pumped VND5.095 trillion into DQS, including chartered capital of VND1.99 trillion and VND3.104 trillion for paying its debts.

However, by June 30, 2016, DQS still had a total loss of VND6.893 trillion, including loans at banks worth a total of VND1.227 trillion.

DQS made profits in 2014 and 2015, but it was expected to incur a loss of VND103.7 billion in 2016 because of the current difficulties in business.

This shipbuilding company still has three large loans pending -- a loan of VND490 billion from Vinashin Finance Company (VFC), a loan of VND528 billion from Viet Nam Development Bank (VDB) and a loan of VND548 billion from YMC-Transtech, a contractor of DQS. — VNS

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