The plan to sell
49 percent of EVN Telecom’s stakes to the Corporation for Financing and
Promoting Technologies FPT has received a nod of approval from the Prime
Minister. Meanwhile, the head of the Electricity of Vietnam (EVN), the holding group of
EVN Telecom has said it does not want to hold controlling stakes in the telecom
company, because it needs to gather strength on developing power projects.

Software
giant FPT and its subsidiary FPT Telecom received the approval to buy 49
percent of stakes in EVN Telecom in January 2011. Under the equitization plan
of EVN Telecom, a part of state-owned capital will be sold to the strategic
partner FPT and to the enterprises’ staff.

With the
approval, EVN will still hold controlling stakes in EVN Telecom, even though it
will sell stakes to FPT.

Prior to
that, in November 2010, the Prime Minister agreed in principle to the plan
under which EVN Telecom chooses FPT and FPT Telecom as strategic shareholders
when EVN Telecom goes equitized. After becoming the strategic partner at EVN
Telecom, FPT and FPT Telecom will have to hold more than 50 percent of the
chartered capital of the company in the whole of its operation duration.

“EVN
Telecom needs to speed up the equitization as the firm is facing some financial
problems,” said a senior official of the company some days ago. “We
are seeking investors - strategic partners with leadership in technology and
the ability to rescue EVN Telecom with GSM technology”.

With the
sale of stakes to FPT and FPT Telecom, EVN Telecom has pioneered the tendency
of mergers and acquisitions in the mobile service market. Buu Dien Vietnam has quoted its sources as saying that
EVN had a meeting with the representatives from a big mobile network in Vietnam
to discuss the “ownership transfer” of EVN Telecom, but no agreement was
reached at the meeting.

At a recent
meeting with the Ministry of Information and Communications (MOIC), Dao Van
Hung, Chair of EVN’s Board of Members, said that EVN does not want to hold the
controlling stakes in the telecom company.

“The
government has instructed EVN to gather strength on developing power production
and business. Therefore, EVN thinks that it needs to report this to MOIC,” Hung
said.

Addressing
the issue, MOIC Minister Le Doan Hop said that EVN needs to clearly define its
strategy in EVN Telecom’s equitization. If EVN thinks that it is strong enough,
it can hold the controlling stakes when equitizing EVN Telecom. But if EVN
thinks that it is not strong enough, it should not hold the controlling stakes.

Hop said
that EVN can learn from Viettel which purchased the mobile network Teleco in Haiti.
As Viettel wants to hold the control over the network’s operation, it tried to hold
controlling stakes.

Pham Hong
Hai, Director of the Telecom Department of MOIC said that in the first quarter
of 2011, MOIC will issue regulations stipulating for which kinds of telecom
businesses the State needs to hold controlling stakes.

“These will
be the telecom companies which play a specially important role in the national
information infrastructure. I do not think that EVN Telecom will be listed
among the group of enterprises,” Hai said.

EVN Telecom
will negotiate the price directly with FPT and FPT Telecom. To date there is no
further information about the prices of the stakes or about share sales.

Some months
ago, the then General Director of FPT Nguyen Thanh Nam told the press that the
purchase of EVN Telecom is a “gamble” for FPT, because the telecom market is
very stiff. However, many people believe that the deal of purchasing EVN
Telecom’s stakes will be reconsidered under “Truong Dinh Anh’s administration”.
Truong Dinh Anh, the newly appointed General Director of FPT has been well known
as a cautious person who always thoroughly considers investment efficiency, and
he will give up the projects which cannot bring profit.

Tuyet Ngan