Vietnam Urban and Industrial Zone Development Investment Corporation (IDICO) sold its entire offering of more than 55.3 million shares in an initial public offering at HCM Stock Exchange on Thursday.

IDICO auctioned 55.3 million shares, equivalent to 18.44 per cent of its charter capital, at the initial price of VND18,000 (US$0.79) per share. A total of 656 investors participated in the auction. Total bidding amounted was 269.3 million shares, five times higher than the total offering.

All the shares were sold at an average of VND23,940 per share.

Foreign investors purchased 41.35 million, equal to 75 per cent of total shares.

IDICO has charter capital of VND3 trillion ($132.2 million), equivalent to 300 million shares. Under the equitisation plan, the State will retain a 36 per cent stake in IDICO while the amount sold to the public amounted to 55.3 million shares, or 18.44 per cent of its capital.

Another 135 million shares, or a 45 per cent stake, will be offered to strategic investors.

The Government plans to divest entirely from IDICO by the end of 2018.

In the lead-up to the sale, IDICO CEO Nguyen Van Dat said 12 investors had expressed interest in becoming strategic partners. Kinh Bac City Development Share Holding Corporation, Bitexco Group and SSG Corporation have submitted documents and made deposits.

IDICO’s representative said all three companies could become strategic partners if total bidding was lower than a 45 per cent stake. If the total bidding is higher than 45 per cent, the company will organise an auction with the initial price being set higher than the average winning price in the IPO.

The most important criterion for selecting strategic investors is that investors must have experience in at least one of the three core business lines of IDICO, including construction of technical infrastructure in industrial zones and transport; electricity production and trading; and construction and development of urban and residential areas.

Prospective investors must have total assets of at least VND2.5 trillion and owner’s equity of at least VND1.5 trillion. They must have enough financial capacity to buy at least 15 per cent of IDICO’s charter capital.

IDICO’s representative said the company’s next development strategy would depend much on its strategic partners. — VNS