The Vietnamese government has approved Vietnam Airlines' much-anticipated plan to sell 25 percent of its shares to investors.
Twenty percent, or 282 million shares, of the Hanoi-based, state-owned airline will be sold to strategic partners, according to a government decision signed Wednesday by Deputy Prime Minister Vu Van Ninh.
Around 1.5 percent, or 21.5 million shares, will be offered to the company's employees, while roughly 3.5 percent will be sold to the public.
After the privatization, the government will retain a 75 percent controlling stake in the airline whose registered capital is roughly VND14 trillion (US$661 million), according to the decision.
The government has authorized the Minister of Transport to decide the debut share price of the carrier at its initial public offering (IPO), the decision said, without giving a specific date for the IPO.
The carrier’s privatization plan includes the retention of its entire current staff of 10,180.
Vietnam plans to partially-privatize 432 out of 949 enterprises wholly-owned by the state by the end of next year.
But only a few - including Vietnam Airlines, mobile network operator MobiFone and garment firm Vinatex - are expected to catch the eyes of foreign investors.
The airline's IPO has faced bureaucratic delays for several years and comes as competition from ambitious low-cost carrier VietJet Air heats up. Its rival agreed last year to buy $9 billion worth of planes from Airbus Group over the next decade and plans to list in two years, likely outside Vietnam.