The Viet Nam Cement Corporation (VNCC) currently holding 46 per cent of the nation’s cement market, expects to complete equitising all of its subsidiaries by the end of 2007, according to director Le Van Chung. The corporation’s target is to restructure to follow the parent-subsidiary model and establish the Viet Nam Cement Industry Group which would focus on cement production, assembling construction machinery and other related services, said Chung.
The corporation has so far completed the equitisation of four subsidiaries: Bim Son Cement Co. But Son Cement Co. the Cement Materials Transport Co. and the Cement Plaster Enterprise. The corporation will equitise three additional companies by the end of this year and is waiting for the Ministry of Finance to approve the reorganisation of its capital structure to speed up the process. The corporation also plans to raise additional capital by listing a number of its already equitised companies on local stock trading centres.
The corporation will retain only a 51 per cent stake in the soon to be listed companies. In addition to raising capital through equitisation, the corporation will also raise cement prices to offset losses caused by rising raw material prices as well as by its falling market share. The corporation’s short-term strategy is to stabilise and diversify development, with cement production as the focus, in order to answer to the rising demand in both domestic and foreign cement markets. The Viet Nam Cement Corporation produced and sold more than 6.9Mt of cement in the first half of 2006, an increase of five per cent over the same period last year. The corporation is expected to produce and sell a total of 12.25Mt in 2006, which will account for 38 per cent of the total domestic cement production.