MobiFone to be privatized next year

1 min readUpdated May 28, 2025Aug 17, 20175:10 AM

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Vietnamese state-owned operator MobiFone has been instructed to complete a privatization and restructuring process known as equitization in 2018, while former parent VNPT has been instructed to equitize in 2019.

The Ministry of Information and Communications plans to assess and approve the restructuring plans of MobiFone as well as Vietnam Television Corporation and VNPost by the end of the month.

VNPT will meanwhile submit its own restructuring plan during the same period in advance of an equitization in 2019.

The government has revealed plans to concentrate on improving the strength of the companies rather than maximizing revenue from the privatization processes, and will decide whether to sell stakes to a few strategic investors or to many individual shareholders on a case-by-case basis.

MobiFone was separated from VNPT is 2014 as part of the latter’s restructuring plan, which also involved dividing VNPT’s operations into three subsidiaries concentrating on infrastructure, services and sales respectively.

After its separation, MobiFone commenced its equitization plan and appointed appraisers for an IPO. The company has drawn interest from a number of potential international investors, including Singtel, Telenor, Australia’s Telstra and Sweden’s Comvik.

To complete the process MobiFone will need to be reappraised – its last valuation in 2015 has expired. Previous valuations have suggested that the company could be worth over $4 billion.

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What this means

MobiFone's expedited 2018 equitization presents a critical opportunity for Vietnam to attract foreign direct investment and boost its telecom sector. The government's emphasis on strengthening companies rather than maximising immediate revenue suggests a more strategic, long-term approach to privatisation. This move could put pressure on competitors by introducing international best practices and capital, potentially increasing market competition. Unlike VNPT, which is slated for 2019, MobiFone has already attracted interest from global players like Singtel and Telenor, highlighting its perceived value. The primary risk lies in the upcoming re-appraisal, which must accurately reflect its value to secure optimal investor engagement and avoid undervaluing a company previously estimated at over $4 billion. We will be watching for the Ministry’s approval of restructuring plans by month-end.

Rajiv Menon

Questions & Answers

What is the primary goal of the Vietnamese government regarding these privatisation processes?

The government intends to focus on improving the strength of the companies involved. They are prioritising company development over maximising the revenue generated from the sales of stakes during the privatisation process.

How will the government decide on the type of investors for these companies?

The government will make this decision on a case-by-case basis. They will choose whether to sell stakes to a few strategic investors or to many individual shareholders depending on the specific company.

Which international companies have shown interest in investing in MobiFone?

Several international investors have expressed interest in MobiFone. These include Singtel, Telenor, Australia's Telstra, and Sweden's Comvik, indicating broad international attention.

Why does MobiFone need a new valuation before completing its privatisation?

MobiFone requires a new appraisal because its last valuation, conducted in 2015, has now expired. Completing the privatisation process necessitates an up-to-date assessment of the company's worth.

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