Citibank N.A Vietnam has signed a first contract to lend US$130 million to Vietnam National Shipping Lines to help the state-owned company to finance the expansion of its fleet and ports, Citibank and Vinalines said in a press release Sep. 14.
“This inaugural loan will open door for Vinalines to access the international financial market for more funding,” Citibank said.
Vinalines CEO Mai Van Phuc said under the expansion plan which was approved by the government of Vietnam, Vinalines which will remain the state-owned company, will double its fleet from now to 2010. “In addition, Vinalines will be the main investor to build all the major sea ports in the country,” Phuc said during the signing ceremony in Hanoi.
Unlisted Vinalines, which currently has 160 ships with a total capacity of 1.7 million tons, plans to increase its fleet of cargo ships to 2.6 million tons, including to buy four oil takers of Aframax-class from Vinashin by 2010, he said.
Phuc said Vinalines will continue borrow from other big international banks, and the nearest deal will be a loan of several hundreds of dollars from Credit Suisse later this year.
State media last month said Credit Suisse was in the process to arrange loans of up to US$700 million to Vinalines, and company sources said this week the two sides are closing to reaching a loan agreement of US$200 million to be signed very soon.
Vinalines will have plans to issue bonds in domestic and foreign markets in the coming years, and it will issue a domestic bond valued at VND5 trillion (US$312 million) before the end of 2008, Phuc added.
The company will upgrade four large sea ports of Dinh Vu in Haiphong city, Cai Lan in Quang Ninh province, Cai Mep-Thi Vai in Vung Tau city and Van Phong in Khanh Hoa.
By the end September, Vinalines is expected to have revenues of VND10 trillion, out of its full-year target of VND13 trillion, up 20 per cent from last year, according to Vinalines figures. It target a net profit of VND660 billion this year, up 20 per cent on year.
The company also targets revenues of more than US$1.2 billion by 2010 and US$3.1 billion by 2020, compared with US$688 million in 2006. (Citibank Press Release, Vinalines)
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