State-run Vinaphone and MobiFone, which together hold the majority of subscriptions in Vietnam's mobile phone market, are to be merged as part of a restructuring process, senior industry officials were quoted as saying on Tuesday.
The merger, approved by the Ministry of Information and Communications, still requires the approval of Prime Minister Nguyen Tan Dung, Deputy General Director Lam Hoang Vinh of the state-owned Vietnam Post and Telecommunications group (VNPT) was quoted as saying by the Tuoi Tre daily.
Another VNPT official, Deputy General Director Phan Hoang Duc, confirmed the merger with online news website Kien Thuc (bee.net.vn).
Vinh, who also heads Vinaphone, and Duc were not immediately available for comment, but a VNPT official said merging the two networks was a policy of the group.
The move comes as Vietnam's state-owned companies are restructured to consolidate strength and seek business expansion.
VNPT, which runs Vinaphone and MobiFone, does not publish business results or market share breakdowns, but Vinaphone and MobiFone, two of three domestic service providers, together control more than half of the domestic mobile phone market.
Vietnam had 134.2 million phone users at the end of February, up 3.6 percent from a year earlier, of which mobile phone users grew 4.3 percent from a year earlier to 119 million, government statistics show.
Net revenue from the post and telecoms sectors at the end of last month jumped 21.4 percent from a year earlier to VND22.1 trillion (US$1.06 billion), following annual revenue growth of 19.3 percent in 2011 to $8.03 billion, the government has said.
VNPT said on its website that revenue last year rose more than 20 percent from 2010 to VND120 trillion, more than 70 percent of the sector's total.