VietNamNet Bridge - The State stepped up capital withdrawal from enterprises operating in business fields that normally do not need state investment.

 

Kim Lien Hotel in Hanoi

A report from the State Capital Investment Corporation (SCIC) showed that divestment of 120 occurred, 1.6 times higher than the number in 2014. The total sold was VND4.5 trillion, 2.3 times the value compared to the previous year. 

Biggest auction

In December 2015, SCIC put 3.6 million shares of the Kim Lien Tourism Company, or 52.4 percent of the charter capital, up for auction at the starting price of VND30,600 per share.

The State stepped up capital withdrawal from enterprises operating in business fields that normally do not need state investment.

The company was sold at VND272,200 per share, or nine times higher than the starting price.

The share auction caught the special attention from the public because Kim Lien Tourism Company now owns 3.5 hectares of land located on an advantageous position in the central business district in Hanoi.

The list of potential buyers included big names such as Nguyen Duc Thuy, Nguyen Thi Mai Thanh, chair of REE, Hanoitourism and Phuc Loc Group.

Unusual auction

The auction of shares of the Do Son Tourism Company last August was considered unusual when the investor bid VND58.5 billion per share. As many as 450,490 shares the state held were put up for sale with the starting price of 70,400 per share. 

SCIC’s representative then told the press that the investor might have made a mistake at the auction. Later, the investor gave up the deal, accepting a loss of VND3 billion in deposit money.

However, the biggest problem was that the other two investors also mistakenly bid VND51 billion and VND40.5 billion per share. 

Meanwhile, under current regulations, the starting prices of the shares set for the next auction must be the second or third highest price bid in the first auction.

With such sky-high prices, Do Son Tourism’s shares remain unsold.

Share prices skyrocketed after state sold shares

In July, SCIC announced the sale of 481,120 shares, or 22 percent of stake of Vikoda, a mineral water company.

All the shares sold out. This helped the company’s share prices soar to VND30,000 later. Meanwhile, the share of another mineral company was traded at VND5,000 per share on the UpCom market.

Dirt cheap shares

The State in the third quarter of 2015 decided to sell all the 2.67 million Docimexco shares it had, or 20.2 percent of the company’s charter capital. 

SCIC planned to sell Docimexco’s shares in bulk at the starting price of VND3,000 per share only, the price described as cheap as a glass of ice tea. However, the first auction still failed.