Vietnamese police have arrested the former chairman of state-run conglomerate Vinashin pending a criminal investigation, the government said on its website.
Pham Thanh Binh, 57 years old, was arrested on charges of "deliberately acting against the state's regulations on economic management, causing serious consequences," the government said late Wednesday.
The investigation is under way to clarify Mr. Binh's alleged wrongdoings, it said.
When contacted by Dow Jones Newswires, a company representative declined to comment.
In July, Prime Minister Nguyen Tan Dung suspended Mr. Binh amid concerns Vinashin, one of the country's biggest companies, could be on the verge of bankruptcy after a period of aggressive expansion and inappropriate investment.
The unlisted company, whose full name is Vietnam Shipbuilding Industry Group, was burdened with total debts of 86 trillion Vietnamese dong, or $4.5 billion, while its total assets were 104 trillion Vietnamese dong at the end of June, the government said.
The government said Vinashin leaders had been submitting false financial reports to the government.
Speaking at a government meeting Wednesday, Deputy Prime Minister Nguyen Sinh Hung said the government is determined to restructure Vinashin to continue to support the country's shipbuilding industry.
"The situation of Vinashin is still under control and we can deal with it," Mr. Hung said in a statement published on the government website.
Vinashin will be restructured to focus on its core business of shipbuilding, he said. The company has been spreading its investment in other areas, including real estate, finance, stock-trading and brewing beer.
"The government won't provide money to Vinashin to pay its debts," Mr. Hung said.
Mr. Hung said Vinashin will have to sell or transfer part of its assets and have to privatize its units and negotiate to freeze the loans it had taken.
"A restructured Vinashin focusing on its core business is expected to be able to overcome its difficulties, stop making losses by 2012 and start to make profit by 2014," he said.
Pham Thanh Binh, 57 years old, was arrested on charges of "deliberately acting against the state's regulations on economic management, causing serious consequences," the government said late Wednesday.
The investigation is under way to clarify Mr. Binh's alleged wrongdoings, it said.
When contacted by Dow Jones Newswires, a company representative declined to comment.
In July, Prime Minister Nguyen Tan Dung suspended Mr. Binh amid concerns Vinashin, one of the country's biggest companies, could be on the verge of bankruptcy after a period of aggressive expansion and inappropriate investment.
The unlisted company, whose full name is Vietnam Shipbuilding Industry Group, was burdened with total debts of 86 trillion Vietnamese dong, or $4.5 billion, while its total assets were 104 trillion Vietnamese dong at the end of June, the government said.
The government said Vinashin leaders had been submitting false financial reports to the government.
Speaking at a government meeting Wednesday, Deputy Prime Minister Nguyen Sinh Hung said the government is determined to restructure Vinashin to continue to support the country's shipbuilding industry.
"The situation of Vinashin is still under control and we can deal with it," Mr. Hung said in a statement published on the government website.
Vinashin will be restructured to focus on its core business of shipbuilding, he said. The company has been spreading its investment in other areas, including real estate, finance, stock-trading and brewing beer.
"The government won't provide money to Vinashin to pay its debts," Mr. Hung said.
Mr. Hung said Vinashin will have to sell or transfer part of its assets and have to privatize its units and negotiate to freeze the loans it had taken.
"A restructured Vinashin focusing on its core business is expected to be able to overcome its difficulties, stop making losses by 2012 and start to make profit by 2014," he said.