Hanoi Times - The country’s largest telecommunications group VNPT plans to push ahead the equitization of its key affiliates this year.

Acting VNPT Group CEO Pham Long Tran said Vietnam Datacommunication Company (VDC) and the Vietnam Software and Media Company (VASC) had been asked to compose equitization proposals to seek government approval, allowing VNPT to conduct the equitization process itself in the future.

VDC would shift the national transmission backbone businesses to VNPT and separate VnMedia from the company along with the Vietnamnet o­nline newspaper. The equitization would occur within the companies’ service sectors, including software, o­nline supermarkets, games and value-added services.

VNPT previously intended to convert VDC and VASC into limited companies with o­ne member, in which VNPT would hold 100 per cent of the chartered capital. However, the group’s operational model had changed and it would now o­nly keep the national backbone businesses. “We will conduct the equitization of the entire group o­nce all preparations are complete,” said Tran.

VNPT, meanwhile, did not mention any process for the equitization of its second mobile operator, VinaPhone, in this year’s equitization plan, but reported that it had finished technical proposal grading for financial consulting bidders concerning its first mobile operator to be equitized, MobiFone.

The group would also ask the government this year to execute the equitization of its postal financial company, its fiber optic cable company, Focal, and its postal printing company.

The equitization process would continue to divert three out of the group’s eight production joint ventures into joint stock entities, including Focal, VinaLSC and Vinadaesung, while also converting the Vietnam Postal Saving Company into a commercial bank this year.

Among these, VDC ranked the fifth-largest for revenues by a service affiliate of VNPT, excluding the group’s telecom arm in provinces and cites. The company earned VND 824 billion (US$ 51.5 million) in net revenue in 2007.

All VNPT affiliates had experienced better business results after equitization. By the end of 2006, the annual revenues of the equitized companies were VND 5.3 trillion (US$ 331.2 million), doubling that of pre-equitization. Net profits also increased by nearly 60 per cent in 2006.

VNPT finished the equitization process of its 20 affiliates during 2005-2007, raising its total number of equitized entities to 39.

VNPT group secured net revenues of VND 45.3 trillion (US$ 2.8 billion) in 2007, a year-on-year increase of 14 per cent against those of 2006. Sixty per cent of these revenues came from its two mobile operators, MobiFone and VinaPhone.