2nd share offering in Vinamilk: starting price will be announced later

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The press conference

Under the guidance of the Prime Minister and Ministry of Finance, SCIC is currently selling 3.33% of Vinamilk's chartered capital in this October. Could you please tell about the progress so far?

Mr. Nguyen Duc Chi - Chairman of SCIC's Board of Members: To ensure the sale of state shares in Vinamilk publicly and transparently, attracting many investors, on 18 October 2017, under the approved plan, SCIC will cooperate with Ho Chi Minh City Stock Exchange (HOSE), Vinamilk and group of consultants to hold a roadshow to introduce SCIC's investment opportunities in Vinamilk. Earlier, we also held roadshows in Singapore and Hong Kong.

At this roadshow in Ho Chi Minh City, SCIC collaborates with related units to introduce information about Vinamilk and the share offering and exchanges contents related to the implementation process and Vietnam’s law.

Regarding the process of capital divestment, from experience in Vinamilk's share sale in 2016, SCIC has reported to the Prime Minister, the Ministry of Finance, the State Bank of Vietnam, State Securities commission and competent agencies solutions to remove obstacles in order to create more favourable conditions for investors. Detailed information will be informed at the roadshow and in documents published in accordance with the Vietnam’s current law.

According to the roadmap, SCIC will announce the regulations on the share sale no later than 21 October 2017, announce the starting price and receive the register and deposit of investors from 1 November 2017. The competitive offering is scheduled to be held at the Ho Chi Minh City Stock Exchange (HOSE) on 10 November 2017.

Could you tell more detail about obstacles and solutions to remove these obstacles?

Mr. Nguyen Chi Thanh - SCIC's Deputy General Director: The obstacles arising in the first sale to be solved in this time focus on 3 issues

The first issue is the deposit. Investors expect to make deposits in foreign currencies to avoid risks related to exchange rates. Therefore, SCIC has discussed with the State Bank of Vietnam and SBV has agreed to let SCIC receive deposits in foreign currencies from foreign investors. In addition, non-resident foreign investors are also allowed to pay deposits in foreign currencies to participate in the State share offering in Vinamilk. Procedures for foreign investors to conduct deposit transactions in foreign currencies and buy shares of Vinamilk comply with the SBV‘s guidance.

The second issue is obstacle related to securities trading code for foreign investors. SCIC has reported to the Ministry of Finance and the State Securities Commission. Then, the Ministry of Finance has issued Official Letter No. 13738 / BTC-UBCK allowing foreign investors to participate in the competitive offering without completing procedures for granting trading codes. However, these procedures must be completed in accordance with regulations before the procedures for transfer of securities ownership is made.

The third issue is related to regulation on public purchase offering. Accordingly, in cases of participation in competitive offering, organizations and individuals do not have to comply with regulations on public purchase offering. However, they have to report on the purchasing demand to the organizer and disclose information on the number of shares expected to buy 7 days in advance.

This regulation will not only apply to this share offering in Vinamilk but also to next offerings of SCIC in other companies such as Binh Minh, Tien Phong, and Pharmacy. This will be a favourable factor to increase aggregate demand and create more opportunities for foreign investors.

Did the roadshows in Singapore and Hongkong attract investors?

SCIC’s Deputy General Director Nguyen Chi Thanh: 24 investors in Singapore and 11 investors in Hong Kong expressed their interest in that offering. In particular, most investors were interested in private meetings "one to one meeting" to learn more about Vinamilk.

Have investors participated in the 2016 offering? or Are they new investors?

Mr. Nguyen Chi Thanh - SCIC's Deputy General Director: Most of them are new investors over 2016. They are large-scale financial investment funds such as J.P. Morgan Asset Management, Wellington Management, and Allianz Global Investor.

Has Singapore Fraser & Neave (F&N) - a Vinamilk’s strategic shareholder, joined to buy shares in this offering?

Mr. Nguyen Hong Hien - Member of Vinamilk's Board of Directors: So far, we have not received any information about F & N's participation in this offering.

Why is equitization slow? Pressure of 60 trillion VND and expectation from Sabeco, Habeco VCN- State capital withdrawal of the first 7 months of the year only collected 15 trillion VND. ...

Could you please share the starting price of this offering?

Mr. Nguyen Chi Thanh - SCIC's Deputy General Director: Currently, SCIC and the consulting company are working together to consider and report to the board of members, so there is no specific information at this time.

Mr. Nguyen Duc Chi - Chairman of SCIC's Board of Members: This is the experience drawn from capital sale in Vinamilk in 2016. We will not announce the starting price at the time of disclosure of information and regulations on auction. Because we want to disclose information and regulations soon for investors to study and prepare technical issues, rights, and obligations to join the offering.

The starting price will be announced later to spend time for market research, careful calculation of share value in different pricing methods and closer to the time of opening competitive offering. At the time, the announcement of starting price will be more marketable and will enable investors to participate while improving the effectiveness of the offering.