Vietnam’s government is planning to undertake the equitisation exercise for Saigon Jewelry Company Limited (SJC), the sole gold and silver jewelry enterprise wholly-owned by the state next year, according to an official announcement.
Specific details of the equitization process, however, have not been disclosed. Quynh Nguyen reported on Deal Street Asia.
Established in 1988, SJC is one of the largest jewelry trading companies in Vietnam along with companies like Phu Nhuan Jewellery Joint Stock Company (PNJ), Bao Tin Minh Chau and Phu Quy Jewelry. It operates as a multi-business group whose interests span real estate, financial investment and services as well.
The state-owned jewelry firm, which currently operates 200 jewelry stores across the country, posted revenue of VND22.9 trillion ($981.3 million) and after-tax profit of VND81 billion ($3.4 million) last year.
Vietnam’s jewelry market, which is said to have a size of about $600 million, has attracted many investors including Vietnam-dedicated private equity firm Mekong Capital.
After fully divesting capital from PNJ by the end of 2016, Mekong Capital invested $7.6 million in Ben Thanh Jewelry (BTJ) through Mekong Enterprise Fund III, which has closed three other deals in restaurant operator Wrap & Roll, ABA Logistics and pawn shop F88, since its launch.
The new fund infusion helps Ben Thanh Jewelry build on its existing retail brand to launch a new fine jewelry retail chain in Vietnam called PRECITA, Mekong Capital said in a statement.
In addition to SJC, the state is looking to embark on the equitisation process for seven other companies in 2019.
Vietnam earned over VND28 trillion ($1.19 billion) from IPOs and divestment at state-owned enterprises in the past six months.
Of these, 90 per cent of the value and volume of shares offered came from six big deals, including three PetroVietnam subsidiaries — Binh Son Refining and Petrochemical (BSR), PetroVietnam Oil Corporation (PV Oil) and PetroVietnam Power Corporation (PV Power). The other three big IPOs were those of Hanoi Trading Corporation (Hapro), Vietnam Rubber Group (VRG) and Vietnam Southern Food Corporation Limited (Vinafood 2).
Despite positive results in the first six months of the year, the state-owned equitization process is still slow compared with the government’s target of privatising 85 SOEs in 2018.