VietNamNet Bridge – MobiFone shares have been added to the portfolios of many foreign institutional investors.

MobiFone is one of the three largest mobile networks in Vietnam.

In early August, a representative of Sweden's Comvik met with the leaders of the Ministry of Information and Communication, expressing willingness to become a strategic partner of the equitized MobiFone after 15 years of cooperating with MobiFone under a business cooperation contract.

The Swedish telco said that it would have more advantages than other foreign investors in cooperating with MobiFone in the future.

Nguyen Tuan Ngoc, deputy general director of PNT International Auditing Company, said Comvik understands the quality and profitability of MobiFone, because it was the first strategic partner which provided equipment and technologies to the first mobile network in Vietnam.

Ngoc went on to say that Comvik’s intention to make a long term investment in MobiFone can be seen as a “quality indicator” for the market.

In 2006, when the information about MobiFone equitization was released, Marc Beuls, managing director of Millicom International Cellular SA Group, the holding company of Comvik, said in ScandAsia that Comvik believed it would be able to acquire MobiFone’s shares once MobiFone launched an IPO (initial public offering).

Not only Comvik, but many other foreign big groups have also shown their strong determination to become MobiFone shareholders.

Most recently, Arne Kjetil Lian, vice president of Norway's Telenor, met representatives of the Ministry of Information and Communication to express the group’s willingness to hold the controlling stakes in MobiFone.

Other big groups, Vodafone, SingTel, T-Mobile and Orange (France Telecom), and investment funds and securities companies are also eyeing MobiFone. Some of them reportedly set up representative offices in Vietnam in 2006, seeking opportunities to invest in MobiFone.

It is not a surprise that the second-largest mobile network in the market with 130 million subscribers and 21 percent of the market share can attract so many investors. They want either to become  strategic partners or big shareholders of the profitable telco, which has the highest profitability index among mobile networks in Vietnam.

Dr. Vo Tri Thanh, deputy head of the Central Institute of Economic Management (CIEM), noted that for Vietnam, the most important goal of the MobiFone equitization is finding suitable strategic partners who have high technology capability. This can put pressure on the other mobile network operators, forcing them to provide better services.

The question now for investors is not whether to invest in MobiFone, but whether they can, and at what price.

MobiFone has great advantages in the telecom market, including high profitability, thanks to fully depreciated assets.

However, the question is difficult to answer. The CEO of Saigon Securities Incorporated (SSI) Nguyen Duy Hung said he still cannot comment as the detailed equitization plan of MobiFone has not been made public.

Manh Ha