The Vietnam Coal Group (Vinacoal), which will operate in the form of a holding company, made its debut in Hanoi on November 12, becoming the first State-owned enterprise (SOE) in the country with diversified business interests.
The country’s largest coal producer said the new business form would help the company mobilize capital by decentralizing business activities to core groups instead of the previous single ownership model.
“The change will further increase Vinacoal’s strengths and generate more capital and jobs,” said Vinacoal’s General Director Doan Van Kien.
Vinacoal - the mother company - will consist of 11 businesses, including three coal companies, a financial company, a mining company, a rescue centre for miners, a human resources development centre, two coal project management boards and a clinic.
Vinacoal will hold 100 per cent of the statutory capital of 18 affiliates, over 50 per cent of the statutory capital of 24 subsidiary companies and less than 50 per cent of the statutory capital of four other companies.
The move follows the government approval of a pilot project in August to establish the Vietnam National Coal Group, operating as a holding company.
As per approval, the Vietnam Coal Corporation and its subsidiaries were to be restructured into a robust economic group with advanced technology, modern management methods and diversified businesses. Under the new model, the group had to integrate coal industry, energy engineering, mining, shipbuilding, automobile manufacturing, mineral exploitation and processing.
Mr. Kien said his corporation has over the past 10 years focused on restructuring, reforming and equitizing its member companies. The corporation's earnings in 2005 are estimated to be equivalent to the total amount it earned in the previous 10 years.
He added that in an effort to boost its business, the coal group will turn 17 subsidiaries, of which it holds 100 per cent of statutory capital, into limited liability companies between now and the end of this year, and equitize five other affiliates early next year.
The coal group's statutory capital is estimated to increase to VND4.3 trillion (US$272.15 million) by the end of this year, up VND1.5 trillion (US$94.93 million) as compared to early 2005.
As part of diversifying its business, the company invested VND262 billion (US$16.5 million) into a truck manufacturing project in central Quang Nam Province’s Chu Lai Economic Zone, with an annual production capacity of 3,000 vehicles in 2003.
The company had sold over 20 million tons of coal in the first nine months of this year, an increase of over 40 per cent over the corresponding period last year.
The corporation, which sold 24 million tons of coal last year, currently has 29 opencast coal mines, 14 pits and three sorting centers. It has set a target of producing 35-40 million tons of coal by 2010 for revenue of US$2.5-3 billion.
Coal is an abundant mineral in Vietnam with reserves estimated at 2,345 million tons of anthracite, 78 million tons of semi-anthracite, 38 million tons of coking coal, 96 million tons of thermal coal and 306 million tons of lignite.
Youth, VNA
Vietnamese
