VietNamNet Bridge – The Viet Nam National Textile and Garment Group (Vinatex) remains under pressure to launch a successful initial public offering.

Under the approved plan, the garment giant's IPO would be implemented on the HCM City Stock Exchange on July 22 with nearly 122 million shares out of 500 million shares, with a face value of VND10,000 (US$0.47), to be publicly auctioned.

This follows a recent spate of IPOs of State-owned enterprises in which a large group of shares remained unsold.

Under the approved plan, the garment giant's IPO would be implemented on the HCM City Stock Exchange on July 22 with nearly 122 million shares out of 500 million shares, with a face value of VND10,000 (US$0.47), to be publicly auctioned.

The State is to hold 51 per cent of the VND5 trillion ($234.7 million) charter capital following the IPO. Further, about 3 million shares, or 0.6 per cent of the charter capital, would be sold to Vinatex's internal staff and 120 million shares, or 24 per cent of the charter capital, to strategic partners.

With an initial price of VND11,000 ($0.49) per share, the IPO was expected to raise some VND1.22 trillion ($58 million).

Deputy general director of Vinatex, Le Tien Truong, said on the sideline of yesterday's conference to introduce investment opportunities in Vinatex, that a list of the company's strategic partners had not yet been finalised.

Meanwhile, Tran Quang Nghi, Vinatex's general director, said that the group would consider listing on exchanges in three years.

However, in case of advantageous conditions, such as the early signing of the Trans-Pacific Partnership Agreement, the listing would be implemented in a shorter time, perhaps within one to two years.

According to Decree 108 on administrative punishments in the securities sector, which took effect in November 2013, companies must be listed on exchanges within one year from its IPO and could be fined up to VND150 million ($7,140) for being late.

However, in a move to create favourable conditions for companies which have implemented IPO's or not gained eligibility for listing on exchanges, the State Securities Commission last week released a draft, saying that those companies could register on the Unlisted Public Company Market (UpCoM).

Vinatex is targeted to reach an export turnover of $3.6 billion by 2015 and $5 billion by 2020.

Also in July, the the expected IPO of Viet Nam Vegetable Oils Industry Corporation (Vocarimex) is scheduled to take place on July 25.

Accordingly, more than 37.9 million shares of Vocarimex, accounting for 31.1 per cent of its charter capital, is to be auctioned at the initial price of VND11,300 ($0.49) per share.

The State holding at Vocarimex would be 36 per cent and 32 per cent of the charter capital, or nearly 39 million shares, which is to be sold to strategic partners.

VNS/VNN