A file photo a MobiFone office in Ho Chi Minh City. Photo: Diep Duc Minh
State-run MobiFone, Vietnam's second biggest telecommunication company, has kick-started a plan to sell part of its stake after multiple delays over the past 10 years, local media reported on Monday.
The Ministry of Information and Communication, which currently owns 100 percent of MobiFone, will soon submit the share sale plan to the government for approval, the media quoted Minister Nguyen Bac Son as saying at a government meeting the same day.
Although it remains unknown how much stake the ministry will sell, Son said the sale will possibly raise around VND20 trillion (US$887.82 million).
In its October report, the UK-owned intangible asset valuation consultant Brand Finance ranked MobiFone the fourth biggest brand in Vietnam with a valuation of $306 million.
Originally a member of the Vietnam Posts and Telecommunications Group, MobiFone was allowed to sever its tie with the national group last year.
It now controls 18 percent of the local telecommunication market, equal to the share of VinaPhone, a member of the group, and much smaller than military-run Viettel's share of 52.2 percent.
The government first ordered MobiFone to be privatized in 2005 with early reports indicating that it would possibly sell a maximum stake of 20 percent to foreign investors. However, over the years the plan's details, including time frame, have been constantly changed.
Under the government's latest order, MobiFone was required to sell its stake in the last quarter of this year.
Commenting on the fact that MobiFone has kept missing deadlines for its equitization plan, Son was quoted as telling the meeting that the company is earning huge profit -- its return on equity ratio is more than 49 percent, so it stands at a better position compared to those businesses which suffer losses.
Effectiveness, not time, should be the priority in MobiFone's privatization plan, he said.
MobiFone posted a revenue of around VND36.9 trillion ($1.62 billion) this year, up 8.29 percent year on year, local media reported.