Debt-ridden Vinalines plans IPO; state to control 36 pct of shares

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State-owned shipping giant Vinalines has submitted its plan for an initial public offering to the transport ministry, a move expected to help it pay off debts of VND12.3 trillion (US$564.2 million), news website Saigon Times Online reported Wednesday.
Under the plan, Vinalines will sell part of its capital and issue additional shares to increase its capital. The capital level is expected to reach nearly VND9.3 trillion ($426.6 million) after the company finishes the IPO and debt payments, it said.
At the end of last year its valuation was $1 billion.
The state will own 36 percent of the company after the IPO, which aims to sell 930 million shares, each valued at VND10,000 (nearly $46 cents).
Vinalines hopes to be able to convince its creditors to buy 3.62 percent of the shares to clear its debts. The company expects to finish debt restructuring by 2019.
Post-IPO plans
In its proposal, the shipping company also asked to be relieved of the duty as a debt guarantor for subsidiaries transferred from Vinashin, when the troubled shipbuilder was restructured in 2013.
The subsidiaries’ debts were estimated at over $508 million in total, Saigon Times Online reported.
After the IPO, Vinalines plans to dissolve or pull its plug on ineffective subsidiaries, including Quang Ninh Port, the website said.
Vinalines has remained in local headlines since the middle of 2012 when its former chairman, Duong Chi Dung, fled the country during an investigation into a $17 million graft case.
Dung and other executives were accused of taking kickbacks from a Russian shipyard to buy an old used dock which cost the state $10.5 million to repair.
Last October the Supreme People’s Court upheld death sentences handed to Dung and the former general director Mai Van Phuc after convicting them of embezzling VND10 billion ($474,000) each in the case.
Eight other defendants from the company received up to 22 years in jail.

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