Vinacomin still aims to sell $500 mln bond: report

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Vietnam's Coal and Mineral Industry Group plans to issue international bonds worth $500 million this year, after delaying the sale last year due to unfavorable conditions, a state-run newspaper said on Monday.

The group will apply for government approval to issue bonds to raise funds for major coal, power and bauxite projects this year, the Vietnam Investment Review said, quoting an unnamed official at the firm.

State-run Vinacomin postponed a plan to raise between $500 million and $700 million last November, with reports citing the problems of debt-laden state shipbuilder Vinashin and market uncertainty as factors.

The newspaper quoted the Vinacomin official as saying the Vinashin case had seriously affected the image of Vietnam in general and state-run groups in particular, and that some investors were demanding unacceptably high yields.

In December Standard & Poor's Ratings Services became the third major rating agency after Fitch and Moody's to downgrade Vietnam, potentially raising the cost of capital for the country and its companies.

Another Vietnamese state-run group, Vietnam Electricity, plans to issue overseas bonds worth $1 billion this year. Oil and gas group Petrovietnam has delayed plans for a bond of a similar size.

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