The Ministry of Information and Communications (MIC) has submitted a plan to separate MobiFone from the state-owned Vietnam National Post and Telecommunications (VNPT).
MobiFone may be separated from VNPT
MobiFone would then come under the management of MIC and be restructured into MoiFone Telecommunication Corporation, upon the Prime Minister’s request.
According to the plan, MobiFone would take over the management of satellites Vinasat 1 and Vinasat 2 as well as VNPT Post Company, which has caused VNPT's most losses to date.
VNPT will divert capital from other companies, including SACOM, SPT, Vinacap, VNPT Epay and Nhon Trach 2 gas-fueled power project, which will be then managed by MobiFone.
VNPT will also restructure some of its subsidiaries operating in three sectors: network infrastructure, telecom services and communications. These subsidiaries include VNPT Network Corporation (VNPT-NET), VNPT Telecom Service Corporation (VNPT-Vinaphone), and Communication Corporation (VNPT-Media).
To Manh Cuong, VNPT Deputy General Director said the final restructuring plan for VNPT was submitted to the government late last September. The plan is expected to be approved by the government in the first quarter of this year.
According to the ministry, the splitting of MobiFone and VNPT is the best solution as the mobile service provider has made its mark on the domestic and regional telecom markets.
Once MobiFone is privatised, the government will hold a 75% stake in the company and the rest would be sold to both foreign and domestic investors. MobiFone’s stake are expected to be attractive to investors, especially VNPT members, other than the privatisation of VNPT itself.
Dr. Mai Liem Truc, former Deputy Minister of Information and Communication, supports MobiFone’s privatisation, saying that the separation of MobiFone from VNPT would be good for the telecom market and facilitate healthy competition, as currently, the three biggest mobile service providers are all wholly-stated owned companies.
“The separation of MobiFone from VNPT would initially cause some difficulties for VNPT but the process would bring about long-term benefits,” said Truc.
