Petrolimex to sell large stake to JX Nippon Oil & Energy

If the share sale is completed, the State holding in the group would be reduced to about 75 percent, said Dinh Viet Tien, chief of Petrolimex's Supervisory Board at its annual shareholders' meeting on May 26.

This move is in line with the Petrolimex' equitis-ation plan approved by the Prime Minister in May, 2011, to raise its charter capital from 10.7 trillion VND (493.1 million USD) to 12.5 trillion VND (576 million USD).

The Ministry of Industry and Trade represents State ownership in Petrolimex with a 95-percent stake.

Petrolimex signed a memorandum on strategic co-operation with JX Nippon Oil and Energy last December. The group expects collaboration with the Japanese investor, who has strong financial capacity with 37 percent of market shares in Japan, will promote its financial situation and corporate governance.

At the meeting, Petrolimex' executives also reported on business performance in 2014 and plans for this year.

Ending September, 2014, the group still earned a profit of over 600 billion VND (27.6 million USD) but continuous declines in world oil prices towards the end of the year trimmed profits. It incurred a total loss of 9 billion VND (415,000 USD) after tax by the end of last year.

Due to failure in the profit performance, Petrolimex decided not to pay dividends of 8-10 percent as earlier projected. However, performance of other business lines, which account for 55 percent of the group's total sales including lubricants, insurance, gas, jet fuel and transportation, achieved positive results and offset oil price declines.

In 2015, world oil prices are volatile and unpredictable, but the national economy is forecast to strengthen with the GDP growth forecast of 6.5 percent and inflation rate of about 5 percent.

Petrolimex has targeted sales of oil and gas of 10.08 trillion VND (464.5 million USD) in 2015 (including in both domestic and foreign markets), up 2.5 percent over 2014. However, it trimmed the consolidated revenue target by 24.5 percent to 154 trillion VND (7.1 billion USD).

Its pre-tax profit goal is set at 2.45 trillion VND (112.9 million USD), up to 760 percent over 2014. The dividend rate is still kept at 8 percent in 2015.

This year, the group will also build divestment plans from its insurance arm PJICO Insurance Corp, PGBank and PLand as directed.

PGBank is projected to merge into Vietinbank. The two banks have completed the merger documents and the deal is expected to complete in the end of this year./.