Vinashin to complete debt restructuring in 2013

Troubled national shipbuilding group Vinashin will complete debt restructuring within this year, said Vinashin chairman Nguyen Ngoc Su.

Speaking at the quarterly press meeting of the Ministry of Transport last week, Su said debt restructuring is the central task of Vinashin’s reform. The total amount of debts at US$4 billion can be divided into three groups: a foreign debt worth over US$600 million, domestic debts worth around VND29 trillion and other smaller debts.

For the domestic debt, around VND12 trillion has been restructured through bond issue. The bonds have value of 30% of the debt and carry interest rate equal to that of the government bond.

Another VND17 trillion will be restructured in the fourth quarter of this year or early next year at the latest, Su said.

Vinashin has also reached agreement with creditors and obtained approval from the international court in the U.K. to restructure the foreign debt and it will issue bonds on October 10. The enterprise will also sell other debts with the combined value of over US$100 million at under 30% of value of the debts.

Up to now, Vinashin has solved parts of the US$4-billion debt and sought the way out for the remaining. The enterprise will solve the debt problem within this year or early next year at the latest, Su stressed.

Concerning the restructuring of Vinalines, Deputy Minister of Transport Nguyen Hong Truong said that the Government has approved the plan, ordering that Vinalines will only focus on three sectors, shipping, services and seaports. The enterprise has basically divested capital from non-core businesses.

Vinalines has sold over 90% of overseas ships given approval of the Government. It has evaluated the remaining vessels and will sell them within this year.

Besides, the Government has given nod for Vinalines to delay key shipbuilding programs until after 2020 as the global shipping industry has yet to recover. Therefore, Vinalines’ debts have been rescheduled, meaning that it will not pay interest rates now and will pay the principal after 2020, Truong added.