VietNamNet Bridge - Leading pharmacy firms such as Hau Giang Pharmacy, Domesco and Traphaco have not been included on the list of enterprises that the State Capital Investment Corporation (SCIC) plans to divest from in at least three years.

In late 2015, the public was stirred up by information that SCIC would withdraw its contributed capital from some big enterprises. 

This would have brought great opportunities to investors, because the enterprises are all profitable ones. 

Under a government decision, SCIC plans to divest its shares in eight listed companies, including VNM (where it holds 45.1 percent of stakes); BMI (50.7 percent); VNR (40.4 percent); NTP (37.1 percent); BMP (38.4 percent); FPT (6 percent); SGC (49.9 percent); HGM (46.6 percent); and shares in two unlisted companies – FPT Telecom (50.2 percent) and VIID (47.6 percent).

Meanwhile, three important pharmacy firms which list their shares on the bourse, namely Traphaco (TRA), Hau Giang Pharmacy (DHG) and Domesco (DMC), were not found in the list.

Leading pharmacy firms such as Hau Giang Pharmacy, Domesco and Traphaco have not been included on the list of enterprises that the State Capital Investment Corporation (SCIC) plans to divest from in at least three years.

A senior executive of SCIC recently told the press that SCIC does not intend to withdraw capital from the three firms in the next three years. 

However, the possibility of issuing additional shares to strategic partners has been left open.

SCIC holds 35 percent of DMC shares, 35.7 percent of TRA and 43.4 percent of DHG.

The information may disappoint investors, who know that pharmacies are a profitable business field and look forward for opportunities to invest in the companies.

Domesco’s 2016 shareholders’ meeting approved a plan to make adjustments to its business registration certificate, under which it would give up the right for pharmacy distribution.

This was a preparatory step that Domesco made in order to lift the foreign ownership ratio ceiling to 100 percent. 

Under current laws, foreign invested enterprises don’t have the right to distribute drugs in Vietnam. This means that if Domesco wants to become a foreign company, it has to give up the distribution right.

However, it is still unclear if Domesco’s plan to lift the foreign ownership ratio ceiling would be approved by the State Securities Commission (SSC). 

Since pharmacies are a conditional business field, pharmacy firms are put under the management of many different ministries and branches, including the Ministries of Planning and Investment, Finance and Health. 

Meanwhile, analysts commented that CFR in the past and now Abbott, the big shareholder of Domesco, only wants to raise its ownership ratio, rather than expand the factory in Vietnam.

They said there was a low possibility of DMC mobilizing $50-60 million to build a new factory in accordance with EU-GMP standards, because Abbott had invested $320 million in a factory in Singapore in 2014.


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