VietNamNet Bridge – Infrastructure Development Investment Joint Stock Company (IDICO) under the Ministry of Construction is working on plans to transfer Dak Mi 4 and 4C hydropower plants to Dak Mi Hydropower Plant Joint Stock Company to deal with financial constraints.

According to the review report of IDICO last year, its profit growth was not high in 2014 as profitability has continued its downward spiral since 2013 although the company realized some financial targets for the 2011-2013 period. One of the reasons is that some hydropower plants of the company have just been put into operation while it has spent much on large-scale and long-term projects.

The operation costs of Dak Mi 4 and Dak Mi 4C hydropower plants which have been recently commissioned make up more than 60% of revenues, and their loss-running performances in the initial years have eaten into the corporation’s business results.

Besides, the corporation is seeking funding for Dak Mi 3 hydropower project in Quang Nam Province which costs nearly VND1.6 trillion. The company also finds it hard to take out long-term loans for real estate projects.

On top of that, IDICO is in dire need of VND218 billion to pay for its contractors. Its member companies are also mired by financial difficulties as their competitiveness is low and their construction market shares are shrinking.

As of the end of last year, IDICO should have collected VND729 billion, mainly for hydropower plants and industrial services. Its total debts had amounted to nearly VND6.7 trillion with bank loans making up over VND5 trillion.

IDICO’s foreign debts guaranteed by the Ministry of Finance exceeded US$37 million with Dak Mi 4 hydropower plant alone accounting for about US$34 million.

Therefore, IDICO has asked the Ministry of Construction to quickly decide the transfer prices of assets at Dak Mi 4 and 4C hydropower plants this quarter. Earlier, Deputy Prime Minister Vu Van Ninh agreed on the transfer plan and assigned the ministry to implement it.

SGT