MobiFone, VNPT to complete equitisation within two years

16 Aug 2017

Vietnam’s Ministry of Information and Communications (MIC) has directed wireless operator MobiFone to complete the sale of a portion of its shares (a process known as equitisation) next year, while fellow state-run company Vietnam Posts and Telecommunications Group (VNPT), which owns telecoms operator VNPT-Vinaphone, must finalise the process in 2019. Vietnam Investment Review reports that the MIC will assess and consider approving MobiFone’s restructuring plan by the end of this month, while the Ministry will also submit VNPT’s restructuring proposal to the prime minster. Since plans to sell shares in MobiFone were first mooted in 2005, a number of international companies have expressed an interest in acquiring a stake in the country’s second largest cellco by subscribers, including Orange Group, Malaysia’s Axiata, Telenor Group of Norway, Japan’s NTT DOCOMO, Telstra of Australia, Singapore’s Singtel and Swedish firm Comvik International, although Vietnamese law limits foreign investors to a 49% stake in local companies.

TeleGeography’s GlobalComms Database states that until July 2014 both MobiFone and Vinaphone were wholly owned subsidiaries of VNPT, but at that date MobiFone was spun off from the PTO, as part of efforts to restructure state-run businesses. MobiFone was separated from VNPT and put under the management of the MIC, with a view to undergoing equitisation at a later date. VNPT’s own initial restructuring process was approved in early 2015 and its operations were subsequently separated into three core business units, including VNPT-Vinaphone, which was formally launched in August 2015 and focuses on areas such as the provision of telecoms, broadcasting and IT services.