Vietnam’s Vinacomin – Minerals Holding Corporation (Vimico) will be one of the first Vietnamese large, state-owned corporations to conduct initial public offer (IPO) this year.
The member of the Vietnam Coal and Mineral Industries Holding Corporation Limited (Vinacomin) will auction some 46.7 million shares at the starting price of VND10,500 ($0.49), on April 23. Thus, the state ownership in VIMCO will probably reduce by 25 per cent after the equitisation, if the bidding is successful.
The value of the state capital in Vimico as of April last year, stood at VND2 trillion ($93 million). The company’s charter capital after the IPO is expected to reach that number.
Vimico, a mining and processing non-ferrous and rare metals firm, has investment in more than 10 subsidiaries, which operate across industries of mining, hospitality, passenger transportation, mining equipment supply and real estate. Meanwhile, it has also been affiliated with four companies in the construction materials, gold and precious stone trading sectors.
The company has also been granted the right to exploit a spate of Vietnamese high value metal mines, including two copper mines located in the northern Lao Cai province, the Sin Quyen and Vi Kem, with the total reserve of 254,000 tons. Its subsidiaries are also managing several large mines in the north of Vietnam.
The company’s revenue remained high during the 2011-2014 period, ranging between VND2.5-3.2 trillion ($116.3-148.8 million). Deducting costs and expenditures, profit for the years reached some VND100-200 billion ($4.65-9.3 million).
Post IPO, the corporation, as a parent firm, is hoping for a much higher revenue at VND4.3-5.8 trillion ($200-269.8 million) for the 2015-2017 period. However, profit target is modest, anticipated at around VND55-100 billion ($2.6-4.65 million).
Meanwhile, Vimico is planning huge investment in upgrading the capacity of its mining projects of Sin Quyen, Vi Kem and Lao Cai copper smelting plant, mounting to VND7.1 trillion ($330.23 million).
Along with Vimico, two other major units of the coal and mining giant Vinacomin will auction first batches of shares this year, electricity generator Vinacomin Power and Viet Bac Mining Industry Corp.
Vincomin Power’s IPO will take place first, on April 16 with a size of 236.4 million shares. The Vietnamese government is expected to hold 65 per cent in this corporation after Thursday’s IPO.