Tuesday, January 15, 2008

Vietnam needs ‘markets to stay stable’ for overseas bond sale

Vietnam needs ‘markets to stay stable’ for overseas bond sale

Dung Quat Oil Refinery under construction in central Vietnam will use part of the proceeds from this quarter’s bond issues by the government
The government will sell a US$1 billion foreign currency-denominated bond as soon as the global markets improve, according to the finance minister.

“We are closely watching the movement of international financial markets and need the markets to just be stable for a couple of weeks to sell the bond,’’ Finance Minister Vu Van Ninh said in an interview at a conference in Hanoi recently.

Concerns over the worst housing slump in 27 years reining in the US economy is deterring investors from high-risk, high-yield debt.

The Southeast Asian nation delayed the bond sale, which was initially scheduled for September and will be its second overseas security, due to turbulence in the markets.

The global markets are still not in a favorable condition for Vietnam to sell the bond, Ninh said.

The risk of companies and governments in Asia excluding Japan defaulting on their debt has increased on concern about the US slowdown.

The region’s index of 20 high-risk, high-yield borrowers rose by 47 basis points to 3.79 percentage point Sunday from January 2.

A basis point is 0.01 percentage point.

“All the necessary preparations have been completed, we are just waiting for the market to get better,’’ Nguyen Thanh Do, director of the finance ministry’s external financing department, said in a telephone interview from Hanoi.

The government plans to market the bond to investors in Singapore, where it will be listed, one week ahead of the auction, Do said.

The sale is being managed by Barclays Capital, Citigroup Inc. and Deutsche Bank AG.

The Ministry of Finance late December had postponed the plan to sell $1 billion of dollar-denominated sovereign bonds until the first quarter of this year due to strong dollar liquidity at home.

The issue, originally scheduled for October, has been delayed twice.

The reason for the delay was that the government worried about the influx of dollars into the economy but we figured the impact would be minimal as most of the dollars raised from the bond sale would be spent overseas for equipment import, according to the ministry.

The government is to lend part of proceeds from the debt to state oil group PetroVietnam to import equipment for the $2.5 billion Dung Quat refinery, the Southeast Asian country’s first.

Other recipients of the proceeds include state-owned shipping firm Vinalines, Song Da Corp. and engineering firm Lilama, to buy cargo tankers and build power plants in Laos.

In October 2005, Vietnam sold its debut Eurobond worth $750 million, having received orders for more than $4.5 billion.

The issue helped set a benchmark for the country’s creditworthiness and similar issues by domestic firms.

Source: Bloomberg/Reuters

Vietcombank’s assets jump 14 percent

Vietcombank’s assets jump 14 percent

Vietcombank tellers complete transactions for clients in Ho Chi Minh City
The state-run Vietcombank has reported its assets rose 14 percent to VND196.12 trillion (US$12.2 billion).

The Hanoi-based bank, which last month became Vietnam’s first state-run bank to conduct an initial public offering, said its loans surged 44 percent to VND95.58 trillion from the end of 2006, less than 1.3 percent of which were bad.

Vietcombank, or the Bank for Foreign Trade of Vietnam, took in VND143.64 trillion in deposits last year, up 20 percent from 2006.

The bank had a gross profit of VND3.1 trillion last year, it said without giving comparative figures for 2006 or net profit.

It handled export and import payments worth $26 billion last year, a rise of 14 percent from 2006 and accounted for 26.6 percent of the country’s external trade.

The bank said last month its profit would fall in 2007 as mounting competition from more than 30 partly private banks and 28 foreign banks operating in the country hit revenues and boosted costs.

Vietcombank, the largest Vietnamese firm to conduct an IPO, raised $652 million late last year offering, the first share sale by a state bank in Vietnam, valuing the bank at around $10 billion.

It is expected to announce a foreign strategic investor before listing on the Ho Chi Minh Stock Exchange by the end of March.

It also plans to list in Hong Kong or Singapore in 2009.

Source: Reuters

Oil trader eyes January 24 debut for $40 million IPO

Oil trader eyes January 24 debut for $40 million IPO

Shares in Vietnam’s Petrolimex International Trading Co (Pitco) are set to make their market debut later this month as part of the oil trader’s US$40 million initial public offering, the bourse said over the weekend.

The Ho Chi Minh Stock Exchange said Pitco would list all its 9.77 million shares on January 24 at a starting price of VND65,000 ($4.10) each.

Pitco shares’ starting price is lower than the average price achieved at a share auction last April, when the HCMC-based firm raised nearly $14 million by selling 12.25 percent of the state-held shares to the public.

In June 2006 it sold 2.9 percent of the firm in an IPO.

Pitco, 51 percent owned by Vietnam’s top fuel trader Petrolimex, trades oil and petrochemicals.

Its export of minerals, mainly tin and antimony, makes up 40 percent of the country’s minerals exports.

Vietnam is Southeast Asia’s third-largest producer of crude oil but it has to import most of its oil product needs because it has no big refineries.

Its first large oil refinery is slated to start operation in early 2009.

Pitco also deals with coffee, black pepper, rubber and metals.

Vietnam is the world’s biggest producer and exporter of Robusta coffee.

Pitco expects its gross profit to rise 10 percent from the estimated profit for 2007 to VND42.6 billion, while 2008 revenues are expected to rise 14 percent to VND1.6 trillion.

Full-year results were not immediately available but the company said net profit for the first nine months of last year totaled VND32 billion.

Source: Reuters

Monday, January 14, 2008

PetroVietnam, legal association team up

PetroVietnam, legal association team up

14/01/2008 -- 8:44 PM
Ha Noi (VNA) – The State-owned largest oil and gas group – PetroVietnam, signed a legal consultancy deal with the Vietnamese Lawyers’ Association (VLA) in Ha Noi on January 14.

“This cooperation aims at building a safe, efficient and law-abide business environment,” PetroVietnam President Dinh La Thang said at the signing ceremony.

Present at the ceremony, Deputy Prime Minister Truong Vinh Trong praised the cooperation, expressing hopes that the VLA would help local businesses gain thorough understanding of international laws and norms when the country became the World Trade Organisation member.-Enditem


Thai garment company operational in Ben Tre

Thai garment company operational in Ben Tre

14/01/2008 -- 9:07 PM

Ben Tre (VNA) – Thailand’s Alliance One Garment Co. Ltd. has officially put its plant into operation in Giao Long industrial park in southern Ben Tre province and shipped the first batch of products worth 400,000 USD.

Alliance One, the first foreign-invested company operational in the park, has an investment capital of 18.1 million USD. It turns out sportswear products of trademarks like Adidas, Nike and Puma for exports.

The first phase of the plant is expected to be completed in June 2008 and the construction of the second phase, the knitting and dying workshops, will begin in March 2008.-Enditem


French firm puts tanning factory into operation

French firm puts tanning factory into operation

14/01/2008 -- 9:07 PM

Dong Nai (VNA0 – France’s Rostaing Viet Nam has put a 2 million USD tanning factory into operation in the Long Thanh industrial park in the southern province of Dong Nai.

The factory has a designed output of between 30,000-40,000 sq.m. a month.

Rostaing Viet Nam has been in the country for 13 years, involving in manufacture of rubber, plastic and leather products to exports to European markets.

It already has plants in Bien Hoa II and Ho Nai industrial parks in Dong Nai.-Enditem


Lang Co town taps tourist strength for growth

Lang Co town taps tourist strength for growth

14/01/2008 -- 8:25 PM
Thua Thien-Hue (VNA) – Possessing white-sand quiet beach and ranges of mountains stretching to the sea, Lang Co town in central Thua Thien-Hue province is an ideal getaway spot and has been successful in inviting both local and foreign investors into spurring its potential.

The Gia Minh Conic Company of the Conic Real Estate Group has recently broken ground for the Conic-Lang Co Resort complex in the town.

The 10-ha 400 billion VND complex is designed to have 200 rooms, 40 world-class villas, conventional halls, and expected to be operational in 2009.

The Gia Minh Conic company has also joined hands with the Lap An Development Company of Denmark ’s Nordica Properties to develop the Lap An-Lang Co Resort and Golf Course complex.

The Lap An-Lang Co tourist-golf course project is to encompass 800 luxurious villas and apartments, and two 9-hole golf courses to be built on 145 ha of land and water surface surrounding the Lap An peninsula.

The complex, with construction expected to begin in July this year and complete by the end of 2011, is to cost close to 5 trillion VND.

Early this month, Lang Co town witnessed the construction of a series of marine tourist projects, including the Diana Resort, the Everland Resort, the Le Royal Annam Resort and the Lang Co vessel tour zone.-Enditem