Vietnam refinery operator valued at $3.2 bln ahead of IPO

[HANOI] Vietnam's sole refinery operator Binh Son Refinery (BSR) said on Thursday it has been valued at US$3.21 billion as at end-2015, as it prepares for an initial public offering (IPO) late this year.

The valuation will form the basis for calculating the share price of Binh Son, which operates the Dung Quat oil refinery, Vietnam's only operating refinery, and is also looking to attract strategic investors.

Communist Vietnam has slowly been pushing its state-owned enterprises to privatise to boost performance. The process has gained more momentum since a new government took office last year.

BSR said on Thursday that it plans to sell 5-6 per cent of the company to the public in an IPO scheduled for the last quarter of this year.

Chairman Nguyen Hoai Giang told Reuters the government had recently allowed the refinery operator to sell more than half of the company to either foreign or domestic strategic investors, giving a potential buyer a controlling stake.

"I think that's a very open policy and will attract strategic investors strongly," Mr Giang said. "The general psychology of strategic investors is to want to have the right to decide big issues, macro issues, as well as daily operational issues." BSR had so far talked to Japan's JX Nippon Oil & Energy Corp, South Korea's SK Energy Co and Russia's Gazprom Neft among others on potential strategic stake sale, but the talks had not progressed.

"We couldn't find a common voice...It's not an easy process because Dung Quat's capital is very big," Giang said.

BSR's net profit fell 27 per cent in 2016 to 4.49 trillion dong (S$273.7 million), the company's financial statements showed.

Reuters