Vinacomin Plans to Issue Domestic Bonds

Evaluating this event, Mr Tran Xuan Hoa, Chairman of Vinacomin, said: “With the successful issuances of VND3,000 billion in 2007 and 2009 as well as its effective usage of this capital, Vinacomin believes that this issuance priced in VND in 2012 will again become an important part of effective long-term mobilisation channels for investment purposes and production process of Vinacomin. Vinacomin also affirmed that it would manage and use this capital for particular purposes and Vinacomin’s bonds will be secured and efficient for investors”.

 

The par value of this domestic 2012 bond issuance is VND1 billion per bond, the bond is non-convertible and issued opportunistically regarding the Decree nr 90/2011/ND-CP and following the method of agency issuance bonds. Bonds are issued in the book entry form, with floating coupon rate annually payable. The bonds establish a direct, unsecured obligation and they are not the secondary debt of issuer.

 

This is an essential prerequisite for arranging capital to finance investment activities as well as businesses and production of Vinacomin. Furthermore, apart from traditional mobilisation channels, Vinacomin keeps developing methods of issuing bonds domestically and internationally.

 

Mr Nguyen Van Bien, Deputy General Director of Vinacomin, Spokesman of Vinacomin informed that the Strategy of sustainable development for Coal and Minerals Corporations to 2020, and vision of 2030 was authorized by the Prime Minister to the Ministry of Industry and Trade to ratify (Decision 5239/QD-BCT, dated October the 8^th, 2010). Referring to that, the motto of Vinacomin development is: “Be prosperous from mineral and human resources; friendly with environment; adaptable with climate change; harmonious with business partners and co-operators, harmonious with enterprises and labour force”, with declaration of “For the Vietnam National Coal - Mineral Industries Holding Corporation Limited of Prosperity - Friendliness - Harmony”.

 

Mr Nguyen Van Bien also said that in this bond issuance, as the biggest coal and minerals producer of Vietnam, Vinacomin will disburse this capital source from bond issuance to projects in the five year plan in the period of 2011 - 2015, following the coal and minerals development scheme ratified by the Prime Minister. There are essentially important projects, which contribute to secure coal and minerals supply for the economy, insure national energy security and sustainable development for coal and minerals industry, as well as earning financial, economic, social effects and contributing to the development of central and provincial economies.

 

Moreover, Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) and ANZ one-member Ltd. will be agencies issuing and organising issuance consulting. Joint stock securities company VietinBank will be issuance organiser and manager. Mayer Brown JSM (Vietnam) and Vilaf-Hong Duc will be law advisors. According to Mr Le Duc Tho, General Director of VietinBank, issuing bonds of Vinacomin in 2012 that ensures Vietnam’s legal regulations, as well as complies with international standards will be one of noteworthy points that help Vinacomin raise capital for its operations, at the same time improve its financial independence in the context of the current integration.

 

The audited, consolidated financial statements of Vinacomin in 2011 has shown revenues of over VND87,600 billion, profits of VND8,600 billion; averaged salaries of 136,700 employees reach VND8 million a person a month. Predicted total revenues of Vinacomin in 2012 will reach VND 96,000 billion.

 

Currently Vinacomin is exploiting 23 open mines and 46 underground ones; two first alumina factories in Vietnam will commence operating in the fourth quarter of 2012 and in the fourth quarter of 2013; currently there are five power plants in operation with total capacity of 1,100 MW, and another four power plants are being constructed with total capacity of 720 MW.