Vinamilks plans to list at Singapore

Vinamilk (VNM) plans to offer 5% of its shares on the Singapore stock exchange by the end of this year.
A company statement says that it will offer 8.85 million new shares in the Singapore listing, but did not say how much money it expected to raise.
Mai Kieu Lien, the company's chief executive said the overseas listing must still be approved at a shareholders meeting on March 31.

The decision comes amid an aggressive courtship of Vietnamese authorities by many foreign stock markets, such as Singapore, Hong Kong, Seoul and even Prague, all seeking to secure listings from companies operating in one of Asia's fastest-growing economies.
But in mid-December, Singapore appeared to get a leg up on its rivals, announcing it had reached an exclusive deal with the Vietnamese government to help it modernize its capital markets.

Kevin Snowball, director of PXP Vietnam Asset Management said the move by Vinamilk, which is still 50.1% state owned, is just "testing the waters" to see the reception for Vietnamese companies in foreign markets, though he suggested it was a "pretty expensive" move for the company.

"The Vietnamese authorities have had people knocking on their doors extolling the virtues of listing Viet companies on a more developed stock exchange," he said.
"It is our opinion that Vietnam is developing into a proper exchange itself and doesn't really need this," he said. "But it's obviously just a test to see what happens."

Yet it remains to be seen whether Singaporean investors will be as enthusiastic about the company as investors at home.

Vinamilk - which produces dairy products, juices and other beverages and has a 75% market share - is currently trading on the domestic stock exchange at a price that's 43 times 2006 earnings, and 32 times projected 2007 earnings.
Vietnam's stock market, which rose 144% in 2006, is up another 50% so far this year. The market frenzy has alarmed Vietnamese authorities, who have been considering measures to cool the market.

Source: Thanh Nien