Vietnamese shipbuilder, Vinashin, must hand over 13 shipyards, shipbuilding industrial parks and shipping lines to PetroVietnam and Vinalines according to a restructuring plan. The two state-owned companies will also absorb Vinashin’s debts.
The Vietnamese Ministry of Transport (MoT) last week released a statement saying that the firm’s financial ability was “in a very difficult stage” that should “be urgently and resolutely restructured” both in business and manufacturing operations and financial investments.
Vinashin will only keep important manufacturing factories that serve its core shipbuilding business and will operate as a limited company from July 1. The government will also give financial support to help Vinashin implement unfinished shipbuilding projects. The group will also receive US$500 million from the Asian Development Bank annually to complete shipbuilding projects cancelled by its partners.
The ministry admitted ineffective investments, weak project management, poor money inflows and debt were reasons for the restructuring.
Vinashin’s total debts reached nearly VND19.9 trillion (US$1.04 billion) by the end of 2008, according to the Bank of Vietnam in a report from November, 2009.
The Vietnamese Ministry of Transport (MoT) last week released a statement saying that the firm’s financial ability was “in a very difficult stage” that should “be urgently and resolutely restructured” both in business and manufacturing operations and financial investments.
Vinashin will only keep important manufacturing factories that serve its core shipbuilding business and will operate as a limited company from July 1. The government will also give financial support to help Vinashin implement unfinished shipbuilding projects. The group will also receive US$500 million from the Asian Development Bank annually to complete shipbuilding projects cancelled by its partners.
The ministry admitted ineffective investments, weak project management, poor money inflows and debt were reasons for the restructuring.
Vinashin’s total debts reached nearly VND19.9 trillion (US$1.04 billion) by the end of 2008, according to the Bank of Vietnam in a report from November, 2009.