EVN Telecom and JPA cases: Government official says he can see no problems

VietNamNet Bridge – Deputy Head of the Government’s Steering Committee onstate owned enterprise (SOEs) renovation and development Pham Viet Muon saidthat he cannot see any problems that may arise if EVN Telecom is taken over byViettel and Jetstat Pacific is put under the control of Vietnam Airlines.

Deputy Head of the Government’s Steering Committee on state owned enterprise (SOEs) renovation and development Pham Viet Muon
Why is it Viettel, not another telecom company, which has been chosen to takeover EVN Telecom?

A lot of investors showed their interests in EVN Telecom, including aSingaporean partner, and then Vietnamese FPT and VTC. FPT wanted to buy 49percent, while VTC wanted 30 percent of stakes.

This means that if FPT buys stakes, EVN will still hold 51 percent of the stakesin EVN Telecom, while if stakes are sold to VTC, EVN will still hold 70 percentof stakes.

Meanwhile, the aim of EVN when selling stakes is to withdraw the capital it hadinvested in non-core business fields to gather its strength on the power sector.Someone said it wanted to buy some wavebands, but not wanted the debts.Meanwhile, the government wants a partner who can take over all the assets, thelabor force, and all the existing resources created before by EVN Telecom.

As you may know, Hanoi Telecom, a partner of EVN Telecom, has expressed itsworries about the deal…

If I were Hanoi Telecom, I would feel very happy when the deal is made. HanoiTelecom is a partner of EVN Telecom, and nothing will change after EVN Telecomis taken over by Viettel, except the thing that the operation would be betterwhen EVN Telecom is managed by Viettel, an experienced telecom company.

I once had talks with Hanoi Telecom and I said that there is nothing to worryabout.

How about the worries about the violation of the Competition Law?

As a user, I believe that you will not be interested in the Competition Law. Youwill use the services if you find them good and cheap.

However, we still must respect the laws. The Article No 18 of the CompetitionLaw stipulates that Vietnam does not accept the cases of economic concentrationwhich creates the enterprises holding more than 50 percent of the market share.However, the Article 19 of the same law says that in case one of the businessesin the economic concentration case take losses or falls into bankruptcy, thearticle 18 will not be applied.

It is clear that EVN Telecom has been taking loss continuously. Meanwhile,Viettel, though being a big telecom company, is just holding some 37-38 percentof the market share only.

We have heard that Vietnam Airlines would replace the State CapitalInvestment Corporation SCIC to control Jetstar Pacific. How has the affair beensettled?

No final decision has been made, while we are still considering this case.However, it seems that people have misunderstanding about the deal. They thinkthat Jetstar Pacific will merge into Vietnam Airlines.

In fact, Jetstar Pacific is a joint stock company with many shareholders,instead of a state shareholder. The state shareholder is now represented by SCIC,while in the future, things may change, and another entity would be assigned bythe state to represent it at Jetstar Pacific. This will in no way, affectJetstar Pacific,

Joint stock companies must operate in accordance with the enterprise law.

However, people fear that Vietnam Airlines, when representing the stateshareholder’s at Jetstar Pacific, will make the decisions that influence JetstarPacific?

I have to say once more that there is nothing to worry about. The current lawsclearly stipulate when you have some certain proportions of stakes, you willhave the right to make decisions only in some certain things. The Vietnameselaws, like international laws, comprise the articles that protect minorityshares.

Qatans, the second biggest shareholder in Jetstar Pacific, has also agreed onthe plan.

Source: TBKTVN