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Listing stocks overseas: easier said than done?   2008-11-13 - Viet Nam News

Domestic enterprises are exploring offshore listings - especially on regional exchanges such as Singapore Stock Exchange - as an alternative means to raise capital during the global credit crunch.

Among such enterprises, PetroVietnam Finance Corporation (PVFC) - the financial arm of domestic petroleum giant PetroVietnam - recently announced a plan to list shares on the Singapore exchange with the support of strategic partner Morgan Stanley Singapore.

Another PetroVietnam subsidiary - PetroVietnam Insurance Corporation - has also set plans in motion to list shares in Singapore in 2009.

Dairy giant Vinamilk, Saigon Securities Inc, and software giant FPT have also been exploring the possibility of overseas listings since last year.

"International integration is inescapable now that we are a WTO member, and listing offshore is a part of integration," Deputy Prime Minister Pham Gia Khiem said yesterday at a workshop on listings and IPOs of Vietnamese businesses on foreign stock exchanges.

"It's time for domestic enterprises to prepare for offshore listings in the coming years when the global economic situation improves," Khiem said.

Khiem also noted that offshore listings would help enterprises diversify their access to foreign capital and provide an additional effective channel to mobilise capital.

He acknowledged, however, that a legal framework was not yet in place to guide firms in making overseas listings.

State Securities Commission chairman Vu Bang confirmed that no firm with announced intentions to list offshore had yet carried out their plans.

"It's not just that the global credit crunch is drowning equity markets world wide," said Bang. "It's also for the difference between the listing criteria of Viet Nam - a new stock market - and other, more established markets."

Auditing standards between Viet Nam and Singapore, for instance, were quite different in methods of appraising the value of corporate assets and the market value of shares, Bang said.

According to Le Hai Tra, a member of HCM City Stock Exchange's management board, the costs of making an offshore listing is also prohibitive.

State Bank of Viet Nam deputy governor Nguyen Dong Tien said, however, that the central bank would soon issue guidelines to help firms comply with foreign listing requirements, as well as providing financial support for them.



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