SOEs struggle to find strategic investors State-owned corporations and groups preparing to launch Initial Public Offerings (IPOs) as part of their equitisation process are finding it difficult to find strategic investors, industry insiders say. Evaluation of assets, investment schedules and shareholders' interests have proved to be the main problematic areas, they add. The Vietnam Motors Industry Corporation (Vinamotor) is looking for long-term strategic investors as it prepares for its IPO launch on the Hanoi Stock Exchange on March 27, but has met with no success so far, the Dau tu (Investment) newspaper has reported. It quoted an unnamed senior Vinamotor official as saying finding strategic partners was one of the most challenging tasks in the corporation's equitisation process. He attributed the difficulty to a lack of stability in local bourses as also the absence of a proper evaluation of the corporation's real value, based on its trademark, diverse business activities and member firms in different sectors. Vinamotor is to offer 51 million shares with an initial selling price of 10,000 VND (approx. five US cents) per share. The Vietnam Textile and Garment Corporation (Vinatex) is considered a business with strong potential to attract foreign investors, but none has been found yet. Vinatex officials say they have worked with foreign investors and made progress on issues relating to capital contributions and technical transfers, but could not reach agreement on the schedule for long-term investments and the interests of shareholders. They said they are looking for partners who will cooperate with and support the corporation's management after the IPO. "We are looking for partners that operate in the same sector, have advanced management skills, are well-informed about the market, and offer flexible financial solutions," the report quoted Vinatex Chairman Vu Duc Giang as saying. He said the strategic investor should be able to ensure sustainable development of the garment industry in Vietnam. Vinatex is awaiting the Government's approval for its IPO plan, which is expected to happen in the first quarter of this year. Under the plan, the State will hold 51 percent of Vinatex's shares and offer the remaining 49 percent to its domestic and foreign investors. Its strategic partner can hold a maximum of 24.5 percent of the shares (half of 49 per cent). The Civil Engineering Construction Corporation 1 (Cienco 1) also expects to complete its equitisation in the first quarter of this year. The corporation obtained early approval of its IPO plan and has already chosen its strategic investor –Hassyu Company of Japan that will hold 7.7 million of Cienco 1's shares (11 percent). Cienco1 Chairman Pham Dung said that choosing a suitable strategic investor was a crucial part of the equitisation process. Hassyu operates in the same sector as Cienco 1 and is well known in Asia for for its construction equipment and modern management, Dung said. Andy Ho, managing director of VinaCapital, said that to give themselves a better chance of finding foreign strategic investors, SOEs, should seek the services of qualified consultants who can help identify and overcome obstacles. Any good company in Vietnam with a sound development plan will not find it difficult to find one, he said. One main obstacle, Ho said, was the evaluation of an SOE's assets. Here again, the enterprises should consult with experts for fixing a reasonable selling price for their shares, as also seek advice on enterprise structure and management, he said. Under the Government's plan, 432 SOEs are to be equitised this year and the next. Between 2011 and 2013, Vietnam restructured 180 SOEs, bringing the grand total of equitised firms to 4,065.-VNA