Taxi firm Mai Linh mulls selling assets to repay $24 mln debt

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Mai Linh Group, which operates taxi services around Vietnam, is considering selling more than 1,000 vehicles and other assets to repay loans of VND500 billion (US$24 million) it borrowed from around 800 people, the company chairman has said.

Tuoi Tre newspaper quoted Ho Huy as saying:"We are seeking all possible solutions. First, we will ask the Ho Chi Minh City People's Committee and the government to allow us to borrow from the stimulus package or provide other favorable loans.

"Otherwise, we will have to think about selling properties, rest stops, and vehicles to restructure the group."

He said the plan involves selling around 1,000 vehicles valued at VND200-300 billion.

"Due to some difficulties we have been unable to pay the interest on the loans for the past three months."

They had been borrowed from business partners, employees, and other people to invest mainly in the transport business, he said.

"This is a good source when the economy is strong, but has caused great difficulty since the economy is in difficulty.

"The reason is these are short-term loans, but we invested in long-term businesses of five to 10 years.

"It takes five years to recoup the cost of a taxi."

He said there is no fear of default since the group has plenty of assets, including VND1 trillion worth of property in HCMC and stable revenues from 12,000 vehicles.

But Tuoi Tre reported that many of the creditors are worried.

Established in 1993, Mai Linh Group has three major interests -- transport, tourism, and trading.

It has invested trillions of dongs in nearly 60 companies, which only pay dividends of 3-5 percent annually, Huy admitted.

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