Vietnam plans to approve the privatisation of MobiFone, the country's second-biggest mobile telecom operator, by the end of the year after the firm is hived off from state-owned Vietnam Posts and Telecommunications Group (VNPT), the government said.
As part of the privatisation process, MobiFone shares will be sold in an initial public offering, the government said in a directive disclosed late on Wednesday. Plans for the sale are due to be cleared by end-2014, it said.
The government disclosed no further details, nor potential strategic investors in the IPO. The listing has been long expected as Hanoi steps up share sales in major state-owned businesses like national carrier Vietnam Airlines, expected in September, as part of plans to restructure state-owned enterprises.
The plan to spin off Hanoi-based MobiFone under the Information and Communications Ministry comes as its parent VNPT faces increasing competition from rival, military-run Viettel Telecom, the country's biggest mobile network.
While MobiFone accounts for 50-60 percent of VNPT's earnings, according to state media, the privatisation is part of Hanoi's efforts to encourage VNPT to develop other existing businesses, like multimedia services and information technology, to cement its role as a leading force in the telecom sector.
In 2012, the last year for which government data is available, MobiFone had a 21 percent share of Vietnam's mobile phone market of 131 million subscribers, less than half of Viettel Telecom's 44 percent share. VNPT will retain control of VinaPhone, the third-biggest mobile telecom provider.