The Ninh Bình nitrogenous fertiliser
plant of Việt Nam National
Chemical Group (Vinachem). Vinachem)
has proposed to the Prime Minister to delay the equitisation of the
losing Ninh Bình Nitrogenous Fertiliser Plant until it generates profits
again in order to ensure effective restructuring. - Photo cafef.vn
HÀ NỘI – Việt Nam National Chemical Group (Vinachem) has
proposed to the Prime Minister to delay the equitisation of the losing
Ninh Bình Nitrogenous Fertiliser Plant until it generates profits again in
order to ensure effective restructuring.
has incurred losses since its opening in 2012 estimated at over VNĐ3.3
trillion (US$145.4 million) by the end of 2016.
management authority has faced a dilemma between a plant closure and
continued production that could result in further losses of VNĐ1.2 trillion
In case of
closure, the plant would have to spend around VNĐ1 trillion per year to repay
Bình and Hà Bắc nitrogenous fertiliser plants, two member companies of
Vinachem, are among the 12 loss-making projects under the Ministry of
Industry and Trade (MoIT).
Vinachem’s Q4 equitisation report to MoIT, the national chemical group
attributed the poor performance to heavy lending interest, quick depreciation
and a drop in urea fertiliser prices in both local and world markets.
the Ninh Bình plant, the report to the Prime Minister by Vinachem also
mentioned troubles in selling stakes in other member companies, including the
Hà Bắc plant,Industrial Gases and Welding Electrode Co Ltd,Hà Nội Soap JSC and Vĩnh Phú
reported its charter capital rose to over VNĐ13.8 trillion but is still lower
than the Government’s approved capital of VNĐ15 trillion. It has faced a
capital shortage to repay debts as well as make investments.
2016-20 restructuring scheme submitted to MoIT, Vinachem has sought the
approval of the Prime Minister and MoIT to allow the corporation to plan its
divestment roadmap in member companies to ensure feasibility and efficiency.
group is set to carry out equitisation from 2017 to 2019 and proposes that
the Government retain a controlling stake of between 51 per cent and 65 per
cent after equitisation. It also plans to raise its charter capital by VNĐ5
trillion through a share issuance during equitisation.
It has set targets of VNĐ43.6 trillion in total
revenues and VNĐ155 billion in profits in 2017. – VNS