Dragon Capital says divestment rumors "groundless'

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Fund manager Dragon Capital has confidence in the Vietnamese market and rumors that it plans to withdraw capital from it are groundless, a company official has asserted.

"We are even raising capital for two more investment funds in Vietnam," Pham Minh Tuan, deputy general director of the Ho Chi Minh City-based investment firm, said in an interview published Thursday by the Vietnam Economic Times.

"We plan to have a US$50 million investment fund in the third quarter of 2010. This is a confirmation of Dragon Capital's confidence in the Vietnamese market."

Dragon Capital was established in 1994 and now manages $1.4 billion and has seven funds, including closed-end funds Vietnam Enterprise Investments Limited (VEIL) and Vietnam Growth Fund Limited (VGF), both listed on the Irish Stock Exchange.

Tuan said rumors that Dragon Capital wants to withdraw capital started after the two funds announced plans to repurchase shares.

The decision will in fact benefit investors because reducing the number of shares will increase their net asset value, he said.

"As professional investors, when we decide to repurchase shares of the two funds, we have already prepared a large enough amount of money," Tuan said.

"We have anticipated that some investors may want a dissolution amid a global financial crisis.

"This happened two years ago and Dragon Capital still reserves its view that Vietnam is an attractive destination for investment," Tuan said.

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