Part 3: Roadmap equitization

Update: 15-09-2017 | 10:37:46

Part 2: Resources gathered for development

At present, Binh Duong has three state-owned corporations, namely, Becamex IDC, Binh Duong 3-2 Import - Export Production Corporation, and Thanh Le Trading Import Export Company Limited (Thalexim). These are three state-owned enterprises that are responsible for leading the economy of the province in the early development stages. Entering the market economy under the policy of the State, all economic sectors are equal in operations; these corporations have carried out the equitization steps in accordance with the roadmap.

All operations informed

State-owned enterprise equitization not only brings equality in production and business operations but also shows transparency in all activities of the enterprises. The latest information we have obtained is that the Prime Minister has approved the equitization plan of Becamex IDC Corporation, which retains the State capital and issues more shares to raise capital.

Accordingly, Becamex IDC has a charter capital of 13,170 billion Vietnam dong, equivalent to 1,317,000,000 shares. Of which, 671.67 million shares belong to the State, accounting for 51% of charter capital; 4,936,700 preferred shares sold to employees in enterprises, accounting for 0.37% of charter capital; 311,207,100 shares of public auction, accounting for 23.63% of charter capital; 329,250,000 shares sold to strategic investors, accounting for 25% of charter capital. The par value of 1 share is VND 10,000.

Nguyen Van Thien, the General Director of Binh Duong Water and Environment Joint Stock Company (BWS coded securities, a subsidiary of Becamex IDC) hits the gong at the ceremony of posting its securities on UpCOM. Photo: Duy Chi

The Prime Minister also authorizes the Chairman of Binh Duong People's Committee to decide on the starting price for initial public offering and to sell shares to the public for the first time in accordance with the law. Adjust the charter capital structure when not sold to investors under the plan approved by the Prime Minister. Chairman of Binh Duong People's Committee is also assigned to select strategic shareholders in accordance with current laws. The selection of strategic shareholders ensures the conditions that bind the investor to commit to long-term interests with the enterprise and to perform after the initial public offering.

In regard to the arrangement of labor resources, the total number of employees at the time of announcing the value of the enterprise is 2,301; the total number of employees transferred to the joint stock company is 2,301. The financial report of 2015 shows that Becamex IDC achieved more than VND 6,000 billion in revenue. Similarly, the Prime Minister approved the Thalexim equitization plan in the form of partial sale of State capital available at the business. Specifically, Thalexim was equitized with a chartered capital of VND2,366 billion, comprising a total of 236.6 million shares at par value of VND 10,000 per share. After equitization, the State shareholder holds nearly 116 million shares, equivalent to 49% of charter capital; Preferred shares for employees in the enterprise is more than 1 million shares, accounting for 0.45% of charter capital; 11.83 million shares of public auction, accounting for 5% of charter capital; nearly 108 million shares, equivalent to 45.55% of charter capital will be sold to strategic investors growth of 60% over the previous year. Short term assets at the end of 2015 reached nearly VND 27,000 billion, of which money and cash equivalents is more than VND 2,000 billion.

It is known that Thalexim operates in three business areas namely petroleum, shipping and real estates with 11 affiliates and 6 subsidiaries. Among them, Binh Duong Materials and Construction Joint Stock Company (MVC) has registered to trade shares on UpCOM. In addition, Thalexim is also known as the owner of Song Than Industrial Zone 1.

However, by 2016, petroleum trade is still the main business activity accounting for 98% of total revenue. Thalexim rents land from the State and pays land rent according to the land use plan already approved by the competent agency and the law on land management and use. With respect to the arrangement of labor, the total number of employees at the time of announcing the value of the enterprise is 568; the total number of employees transferred to a joint stock company is 568.

First signs of delight

Prior to the equitization of the holding companies, the subsidiaries of these corporations carried out the shares of the pilot and brought good results. Specifically at the 3-2 Construction Investment Joint Stock Company (a subsidiary of Binh Duong 3-2 Import - Export Production Corporation), after equitization and listing shares on the trading floor. Stock, company shares (C32) are well received by the market and strategic investors as the company has steady growth, clear production strategies and business. Dividend pay interest 24% / charter capital. Annual sales increase to 23% even when the real estate market freezes, hard to consume. Because the company is multi-industry and flexible to adjust market demand.

Equitized by the end of 2016 and listed on the stock exchange in mid-2017, shares of Binh Duong Water and Environment Joint Stock Company (BWS coded securities, a subsidiary of Becamex IDC) has fallen into the top positions of attraction to investors. Accordingly, in the fourth quarter of 2016 the company achieved total revenue of VND 399.61 billion, reaching 123% of the plan. Profit before tax of VND 18.27 billion. The plan of 2017 is agreed by the General Meeting of Shareholders with the growth of all aspects: revenue, profit before tax ... increase by 10% from 2016.

It can be said that equitization has brought about initial positive results of SOEs. The clear equitization roadmap of state-owned enterprises has brought a large amount of capital, new spirit to the business to integrate well and operate equally in the market mechanism.

Next: Part 4: Private economic sector makes more important contribution

Reported by Duy Chi – Translated by Vi Bao

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