SCIC organizes a consultative workshop to finalize the divestiture regulation

Hanoi, June 14, 2018 – Under the framework of the project Australia and the World Bank Strategic Partnership 2 (VN-ABP2), State Capital Investment Corporation (SCIC) in collaboration with World Bank organizes the workshop “Perfection of the divestiture regulation – From the perspectives of experts and stake holders”.

The workshop is aimed at collecting diverse comments from related parties, ranging from state agencies to independent experts, on the divestiture regulation drafted by SCIC.

Workshop attendees comprise representatives of the National Steering Committee for Enterprise Reform – Government’s Office, Vietnam Commission for State Capital Management at Enterprises (VSE), Corporate Finance Department – Ministry of Finance, Enterprise Development Agency – Ministry of Planning and Investment, Ministry of Justice, State Audit and World Bank’s experts.

From SCIC’s establishment in 2006 to December 31, 2017, SCIC managed to sell the state shares in cumulative 986 companies. 885 and 82 companies were completely and partly sold respectively and share purchase rights of 19 companies were sold. Whereas the book value of those companies amounted at 8,332 billion dongs, the proceedings from the said transactions reached 36,989 billion dongs (including the sales of 8.73% of Vinamilk’s share) which is 4.4 times higher than book value (the national average ratio of proceeds and book value for the period of 2011-2015 was just 1.45 fold). Divestment process undertaken by SCIC complied with the legal regulation and has been gradually standardized, professional, transparent, efficient, helping preserve and develop the state capital.

To set a foundation for the divestment process, SCIC drafted and issued the divestiture regulation under the Decision No.06/QD-DTKDV-HDTV dated April 11, 2014. Thanks to the said regulation, SCIC established a close, transparent and legitimate divestment process. For years, SCIC has always been regarded as a pioneer in applying new methods to sell the state shares in its portfolio companies. This regulation also brought forward some special and breakthrough mechanisms for the divestment process, helping SCIC achieve remarkable results over the last 10 years. Such mechanisms include lowering the starting price, sale by negotiation, auction in-lot…

In accordance with a number of recently issued legal documents such as the Decree No. 147/ND-CP of the Government on the amendment of the Decree No. 151/2013/ND-CP regarding SCIC’s functions, mandates and operation mechanism and the Decree No. 148/2017/ND-CP of the Government regarding SCIC’s organization and operation charter dated December 25, 2017, the Decree No. 32/2018/ND-CP of the Government on the amendment some certain Articles of the Decree No. 91/2015/ND-CP dated October 13, 2015 of the Government regarding state capital investment in enterprises and the capital and asset management in enterprises dated March 8, 2018 and based on the actual requirement of the calculation of land use right and intellectual property when proceeding the sale of SCIC’s shares in enterprises as well as in consideration of advanced international practices in similar procedures, it is essential for SCIC to amend the current divestiture regulation.

“The amendment of SCIC’s divestiture regulation was started in late 2017. By now, the final draft of the revised regulation has been completed. With a view to optimizing the regulation and in order to appraise it from various perspectives, ranging from that of state agencies to experts and relevant enterprises, SCIC expects to gather valued comments and idea contribution to enable it issue the new regulation soon, which helps create a clear framework for the divestment process in the coming time, especially for the sale of shares in major portfolio companies, assuring the transparency and efficiency of the process.” said Mr. Nguyen Chi Thanh, Standing Deputy General Director, at the workshop.

Mr. Nguyen Chi Thanh, SCIC’s Standing Deputy General Director, delivered the opening remarks at the workshop.

Mr. Sebastian Eckardt, Lead Economist and Program Leader, World Bank in Vietnam, delivered the welcoming remarks at the workshop.

Mr. Nguyen Trong Dung, Deputy Director, National Steering Committee for Enterprise Reform, Government's Office, delivered a speech on SCIC’s model - Achievement after more than 10 years of operation in the broad picture of state capital management in Vietnam

Mr. William P. Mako, Senior Consultant, Private and Financial Sector Development, spoke on state capital management at enterprises - Prevailing models in the world and in Vietnam

Mr. Le Song Lai, Deputy General Director, delivered a speech on SCIC’s divestment process - Achievement and obstacles/hindrances

Mr. Ketut Kusuma, Senior Financial Sector Specialist, Finance, Competitiveness, and Innovation (FCI) Global Practice, The World Bank Group, spoke on sale of shares in companies - Review of the SCIC’s current divestiture regulation

Speakers and distinguished guests took a group photo at the workshop