State-owned Bank for Investment and Development of Vietnam (BIDV) and four other Vietnamese companies have joined hands to establish an aircraft leasing company, the first of this kind in Vietnam, state media said.
The Vietnam Aircraft Leasing Co., or VALC, will have an initial registered capital of US$200 million between 2007 and 2014.
BIDV is expected to hold a 20 per cent stake in the company and Vietnam Airlines will account for 23 per cent share, said a BIDV official.
He also said VALC will raise its capital to US$1 billion in 2015-2025 period for operation expansion, adding that VALC may also issue shares to foreign investors from 2015.
VALC will specialize in purchasing and leasing aircraft, providing air taxi and airport services business with the focus on its key clients including Vietnam Airlines and both local and regional airlines, according to BIDV. It will also operate in the field of financial investment in the aviation industry and some other related services.
VALC will soon discuss with Airbus and Boeing, the world's two largest aircraft producers, to buy their medium- and long-range planes and lease them to Vietnam Airlines or other domestic airlines.
Between 2007 and 2012, VALC plans to invest in upgrading the Cam Ranh and Phu Quoc airports, and then soon buy or lease small 50-60 seat aircraft from foreign companies to start flight services between Ho Chi Minh City and Cam Ranh, Nha Tranh and Phu Quoc, the official said.
The firm expects to offer air taxi services using aircrafts of below 50 seats on the five routes namely Saigon-Phu Quoc, Saigon-Nha Trang, Saigon-Lien Khuong, Hanoi-Dong Hoi and Hanoi-Ha Long.
BIDV and four other investors including Vietnam Airline, Vietnam Oil and Gas Corporation (PetroVietnam), the Vietnam Shipbuilding Industry Group (Vinashin) and Phong Phu Textile Corporation have been actively completing investment procedures to put VALC into operation soon.
The aircraft leasing services will be very promising in Vietnam, where the country’s aviation market is forecast to annually grow up to 14 per cent in the 2006-2010 period, between 9 per cent and 11 per cent in the 2010-2015 period, and between 10 per cent and 12 per cent in the 2015-2020 period, experts said.
They also added the business services will help ease the aircraft shortage in the local aviation sector, which is mainly attributed to financial difficulties. (BIDV’s Associated Press, Foreign Media)
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