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Foreign investors vying for PVOil's stake
Nguyen Tung 16:12, 2018/05/23
PetroVietnam Oil (PVOil) is in talks to sell a 44.72% stake to strategic investors later this year, after its US$184 million initial public offering (IPO) in January, its parent Vietnam Oil and Gas Group, or PetroVietnam, said on May 23.
South Korea's SK Holdings, Japan's Idemitsu Kosan and two Vietnamese companies have registered as potential buyers, with demand for the offered shares exceeding supply by nearly three times, PetroVietnam said in a statement. 
 
Illustration photo.
Illustration photo.
The two Vietnamese companies are Ho Chi Minh City Development Joint Stock Bank and Sovico Holdings, chaired by Nguyen Thi Phuong Thao, the billionaire founder and chairwoman of Vietjet Aviation VJC.HM. Thao is also the vice chairwoman at HCMC Development Bank. 

The stake sale, to be conducted via a share auction, is to take place by end-July. If that date is missed, PVOil is looking to move the sale to November, pending approval from the Prime Minister Nguyen Xuan Phuc, the company said in a separate statement. 

The Vietnamese government raised VND4.18 trillion (US$184 million) by selling a 20% stake in PVOIL via its IPO in January. The proceeds exceeded the government's target of raising at least US$122 million from the IPO. 

The proceeds exceeded the government's target of raising at least $122 million from the IPO. With a 20-22% market share, PVOIL is the second largest petroleum distributor in the country after Vietnam National Petroleum Group (Petrolimex). The firm operates a network of 540 gas stations nationwide under the company-owned company-operated (COCO) model and 3,000 gas stations under the dealer-owned dealer-operated (DODO) model. 

PVOIL said the strategic investors will have to hold their stake for at least 10 years. Under the equitization plan, PVOIL will further offer an additional 44.72% stake to strategic investors through a private placement, resulting in a reduction of State ownership to 35.1%. Through this equitization process, PVOil is expected to raise a total of US$400 million.

PVOil posted its consolidated pre-tax profit in the first four months at VND215 billion (US$9.43 million), equivalent to 63% of the year plan.

Total number of crude oil - condensate exports and sales from all PVOil's branches reached 3.9 million tons, reaching 34% year plan; 1.06 million cubic meters of petroleum, or 34% of year plan and 98% of the volume in the same period of last year. 

PVOil's consolidated revenue in 2017 was estimated at VND56 trillion (US$2.4 billion), 165% of the annual plan, while the profit of the parent company was VND325 billion (US$14 million), and of other subsidiaries was VND154 billion (US$6.9 million). Additionally, PVOil's consolidated pre-tax profit totaled at VND405 billion (US$17 million), an increase of 125% against the annual plan.
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