The rubber group will auction 475 million shares, equivalent to 11.88 per cent of its total charter capital of VND40 trillion (US$1.76 billion) to the public. Another 475 million shares will be offered to strategic investors while the remaining amount will be sold to the group’s employees and trade union.

The State will retain three billion shares, or 75 per cent of the capital after the equitisation, Tran Ngoc Thuan, VRG’s general director said at the company’s extraordinary employee’s meeting on Monday.

Thuan said the group has agreed to propose to the Prime Minister the selling price of VND13,000 ($0.57) a share at the auction on the HCM Stock Exchange.

The company’s employees and trade union are entitled to buy at the price of 60 per cent of the lowest successful bidding price.

VRG is expected to collect over VND12.83 trillion from the share sale.

According to the Prime Minister’s direction, VRG must complete the initial public offering (IPO) on January 1, 2018. However, the group has proposed to the Ministry of Industry and Trade to ask for the Government’s approval of extending the deadline to three months from the date of the approval of the equitisation plan.

In March this year, VRG announced it would conduct its IPO in the second quarter of 2017 but due to the heavy workload and large-scale auction, the sale has been delayed.

After the equitisation, the group will have 99 subsidiary and affiliated companies. VRG has completed the equitisation for two member companies and plans to divest from other 22 companies.

In 2017, VRG has targeted to earn VND4.2 trillion in pre-tax profits, a year-on-year increase of 47 per cent, despite industry forecasts of challenges due to the unpredictable impacts of climate change. 

VNS