VNPT asked to submit restructuring plan by end-June

4 Jun 2013

Vietnam Posts and Telecommunications (VNPT), the country’s state-owned national PTO, has been asked by the Ministry of Information and Communications (MIC) to finalise its new restructuring plan by the end of the month, VietNam News reports. VNPT was initially required to submit a restructuring plan to the government for final approval by the end of last year, under a programme to reorganise state-owned companies aimed at boosting competition in certain markets. New government rules state that an institution or individual that owns more than 20% in one company may not hold more than 20% of another firm operating in the same market; VNPT is the largest fixed telephony and broadband provider in Vietnam and owns 100% of the country’s second and third largest mobile operators by subscribers, Vinaphone and MobiFone. However, in April 2013 the MIC rejected VNPT’s initial restructuring proposal, which put forward plans to merge MobiFone and Vinaphone, stating that the move would have a negative impact on competition. According to the ministry, VNPT’s initial proposal did not follow the government’s telecommunication plan, under which the country must still have three to four large telecoms operators following the restructure; if MobiFone and Vinaphone were to merge, the mobile market would be left with just two large players – the combined VNPT unit and the largest cellco by subscribers, Viettel. The MIC has stipulated that the restructuring must not result in the disappearance of one of the three largest telecoms brands (Viettel, MobiFone and Vinaphone) in the market.