Vietnam Airlines to sell $108 million stake to Japan’s largest airline

May 24, 2016 | 03:29 am PT
Vietnam Airlines has announced it plans to sell a stake equivalent to nearly nine percent of its charter capital to All Nippon Airways Holdings, and the $108 million deal could be signed by the end of May.

Vietnam’s leading carrier will sell 107,668,938 shares worth 13 billion Japanese yen, equal to 8.77 percent of Vietnam Airlines’ charter capital, to ANA Holdings for VND21,000 ($0.9) per share, according to the Ministry of Transport’s newspaper.

At the Vietnam Airlines’ shareholders meeting this morning, the Ministry of Transport approved the Vietnam Airlines (VNA) plan to increase its charter capital through the stock transfer from VND11.2 trillion to VND12.27 trillion (over $550 million) in line with the Law on Enterprise and Law on Securities.


Vietnam Airlines has tied up with All Nippon Airways by selling a 9 percent stake to raise its charter capital. Photo by vemaybaytinich

The strategic alliance with All Nippon Airways “will help Vietnam Airlines acquire new management technology, expand our marketplace, improve service quality and strengthen competitiveness in the international market,” said Pham Viet Thanh, former chairman of Vietnam Airlines Corporation.

Vietnam’s flagship carrier will reduce its state ownership to 75 percent through the sale and plans to cut it down to 65 percent of charter capital in line with the approved divestment scheme.

The Ministry of Transport will allow VNA to retain the capital made from the sale to ANA Holdings. The disbursement of this amount shall be decided at the general shareholders meeting.

According to the Financial Times, Vietnam is an interesting market for Japanese enterprises, which are investing heavily in the Southeast Asian country as it reduces its dependence on China. From 2011 to 2014, FDI from Japan to Vietnam increased three times and reached $9 billion.

ANA, the biggest operator of the Boeing 787 Dreamliner, has taken possession of more than half of the 83 long-haul aircraft it has ordered. Japan’s biggest airline is the owner of 240 aircraft, operating between 88 destinations with about 47 million passengers annually.

The Star Alliance member has 63 subsidiaries globally and 18 branches worldwide.

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