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VietNamNet Bridge – APEC Securities Company has become the first securities
company to be merged into others under the plan to restructure the stock market.
The decision was made half a year after the plan was approved by the Ministry of
Finance.
The 2012 annual shareholder’s meeting of APEC Securities Company (APS) approved
the plan to merge APEC into others. This is the first securities company which
has made public the merger plan so far.
While merger and acquisition (M&A) is quite a normal activity of securities
companies all over the world, the concept remains a taboo word in Vietnam, where
in people’s thoughts, M&A is carried out only when companies incur loss or get
dissolved.
Nguyen Do Lang, President and General Director of APS, said on Dau tu chung
khoan that a lot of securities companies have to scale down their business and
reshuffle to get adapted to the gloomy stock market.
He also said that 100 operational securities companies is too much for a
fledgling market like Vietnam, therefore, cutting down the number of securities
companies proves to be inevitable. That is the reason why APS plans to merge
into other securities companies in 2012.
Also according to Lang, APS now belongs to the group of average grade companies.
In the context of the stiff competition, if APS cannot add itself into the list
of top 10-15 securities companies holding biggest market shares, the company
would face a lot of big challenges. Therefore, APS has drawn up a merger plan,
considering this the first step in its strategy to improve the company’s
competitiveness.
“The partners of APS could be anyone who have competitiveness and help APS
improve its competitiveness after the merger, no matter they are small or big,”
Lang said, adding that APS would refuse the big companies with big debts and the
market segments coinciding with APS.
Trinh Hoai Giang, Deputy General Director of the HCM City Securities Company,
also said that as the stock price has been falling, a lot of companies have
incurred big loss. Therefore, scaling down business or merging into each other
proves to be the wise moves.
The watchdog agency - the State Securities Commission SSC – has been facing
violent criticism from people for the slow implementation of the restructuring.
However, SSC’s Chair Vu Bang, in an interview given to Thoi bao Kinh te Vietnam,
explained that it is not easy to eliminate securities companies.
“Not only the Ministry of Finance, but SSC’s leadership has also urged relevant
departments to cut down the number of securities companies,” Bang said, adding
that the merger and acquisition need to be carried out on the voluntary basis in
the first phase of the reshuffle process.
To date, SSC has finished analyzing securities companies and classified them
into three groups, including the group of companies in normal operation; the
group of companies needed the control from watchdog agency, and the third group
of companies to be put under the special control.
SSC has released the decision to put seven securities companies under the
special control, namely VRG Securities, Vina Securities, Hanoi Securities,
Truong Son Securities, Da Nang Securities, Mekong Securities and the Vietnam
Industry and Trade Securities Companies.
Also according to Bang, five securities companies have stopped providing
brokerage service. In the first six months of 2012, six securities companies
belonging to commercial banks were inspected by SSC. It is expected that 20
companies would be inspected in 2012.
However, Bang said that the securities company restructuring process is facing a
lot of difficulties.
Source: DTCK, TBKTVN
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