BizLIVE - The slowdown in divestment was attributable to the decline in the firm’s profit.
Vietnam’s Sovereign Wealth Fund Sees Profit down 41% on Sluggish Divestment
SCIC plans to divest stakes in 137 companies in the 2017-2020 period.
State Capital Investment Corporation (SCIC), the Vietnamese government’s investment arm, has announced that it earned a net profit of 2.4 trillion dong ($105.7 million) in the first half of this year, down 41% from a year earlier.
The company’s revenue dropped 54% year on year to 2.67 trillion dong ($117.5 million), its first-half financial statement showed.
Earnings from investment, the differential between the initial value and the proceeds from divestment, shrank 94% from the same period last year to 193.42 billion dong ($8.52 million). Its only major divestment was the sale of its stake from debt-laden Thai Nguyen Iron and Steel Company.
Meanwhile, in the first half of 2016, the company conducted big-ticket divestments such as those from Southern Waterway Corp. (SWC), Binh Duong Mining Co. (KSB) and Quang Ninh Cement (QNC). In the second half last year, it booked proceeds of nearly $1 billion from reducing stakes in Vinamilk (VNM), Vinh Son-Song Hinh Hydro Power (VSH), and Gemadept (GMD).
SCIC earlier this year published a list of 137 companies it plans to divest in the 2017-2020 period, including Vinamilk, Tien Phong Plastics (NTP), Binh Minh Plastics (BMP), Bao Viet Holdings (BVH) and Military Bank (MBB).
SCIC’s total assets slipped 13.3% from end-2016 to 33.26 trillion dong ($1.46 billion) as of June 30, 2017, of which short-term financial investments accounted for 92.2%.