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FPT Telecom prepares to trade on UPCoM

Released at: 11:30, 10/12/2016

FPT Telecom prepares to trade on UPCoM

Photo: FPT/Courtesy

Telecommunication subsidiary of FPT Group aims to expand in the US and increase sales to $1 billion by 2020.

by Quynh Nguyen

FPT Telecom JSC, a subsidiary of FPT Group, has been granted the trading code in the UPCoM with the code FOX, according to Vietnam Securities Depository (VSD).

The number of shares is 137,078,609, equivalent to the charter capital of VND1.37 trillion ($60.2 million). The Vietnamese telecommunication giant in November announced that it closed the list of shareholders to trade on UPCoM. It has charter capital of VND1.2 trillion ($52.8 million), equivalent to 124.6 million shares.

State Capital Investment Corporation (SCIC) is a major shareholder of FPT Telecom, with 62.5 million shares, equivalent to 50.16 per cent. FPT Group holds 56.88 million shares, equivalent to 45.64 per cent and the remaining shares of 4.18 per cent belong to other shareholders.

As planned, SCIC will have to divest all its capital at FPT Telecom. This is an opportunity for FPT Group to buy the capital from SCIC and increase their percentage of ownership at the enterprise. “FPT Telecom trading on UPCoM is expected by many investors this year.” Mr. Dang Quyet Tien, Deputy Director of the Corporate Finance Department under the Ministry of Finance (MoF) said.

The divestment at Vinamilk in 2016 and nine other enterprises including Bao Minh Insurance Corp, Vietnam National Reinsurance Corporation, Tien Phong Plastic JSC, Binh Minh Plastic JSC, Vietnam Property and Infrastructure JSC, FPT Corp, FPT Telecom, Ha Giang Mineral Mechanics JSC, Sa Giang Import Export Co., will conduct state capital divestment in early 2017, Mr. Tien added.  

FPT Group’s Chairman Truong Gia Binh said at the Bloomberg ASEAN Business Summit in Hanoi, that FPT aims to implement one or two merger and acquisition (M&A) deals each year to expand the market and develop new businesses. “We are planning to invest about $50 million annually. FPT wants to develop more in America.” Mr. Binh said. “We expect to have some M&A deals in the US, worth about $50 to $100 million.”

Japan is the most strategic market of FPT at present, contributing up to 50 per cent of the total revenue. However, the highest growth rate belongs in the US market, with 45 per cent. The remaining revenue comes from emerging countries such as Bangladesh, Laos, Myanmar, and Cambodia.

FPT's plan is to increase its global sales from the current figure of $200 million to $1 billion by 2020. Recently, when the Vietnamese Government requested the State Capital Investment Corporation (SCIC) to withdraw all its capital from FPT (6 per cent of  the charter capital), many foreign institutions were interested in the idea, but the SCIC has not released the specific schedule for the sale of FPT shares, Mr. Binh said.

FPT Telecom is one of the largest telecommunication and internet service providers in Vietnam along with VNPT, Viettel, and MobiFone. In the first nine months of this year, FPT Telecom’s revenue stood at VND4.9 trillion ($215.6 million) and pre-tax profit at VND848 billion ($37.3 million), up 5 per cent year-on-year.

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