Bao Viet, Vietnam's largest insurance firm, said on Friday it expected to raise at least $112.5 million in an initial public offering this month.
The company will offer 59.44 million shares, or 8.74% of its total share capital, on May 31.
Bao Viet, formally called The Vietnam Insurance Corporation, set the starting price at 30,500 dong ($1.89) for bids at the auction on May 31 at the over-the-counter Hanoi Securities Trading Center, the exchange said in a statement.
The Hanoi-based firm, which sells both life and non-life policies, would be valued at $1.3 billion at the starting price. It has a registered capital of 6.8 trillion dong ($422 million).
Foreign investors are allowed to buy up to 13.6 million shares at the auction, but insurance firms operating in Vietnam, their related investment funds and Bao Viet subsidiaries are excluded, it said.
Communist-ruled Vietnam limits foreign ownership of a non-bank listed company to 49%.
The Finance Ministry, which controls Bao Viet, has said the insurer would sell 18% of its shares to foreign investors and the state would retain 65.34% ownership.
After the IPO, Bao Viet would also sell 0.7% to employees and the remaining 7.22% to strategic investors.
The Hanoi exchange and Bao Viet did not say why the IPO was delayed from May 17, the date announced originally, but chief executive Nguyen Thi Phuc Lam said this week Bao Viet would complete its partial privatisation by the end of May.
Bao Viet had assets of nearly 17 trillion dong ($1.05 billion) at the end of 2006.
Its revenues grew 19% per year between 1995 and 2005. Last year, it had revenues of 7 trillion dong ($434 million), of which premiums made up 5.5 trillion dong, or 37% of the premiums in Vietnam's insurance sector.
Bao Viet Securities (BVS), a Bao Viet subsidiary, listed on the Hanoi exchange in December. The securities firm is a new business as Bao Viet plans to branch out into banking, financial leasing, real estate and public health insurance.
On Monday, Bao Viet signed a strategic cooperation agreement with Vietnam Posts and Telecommunications group.
"Both sides will prioritise in contributing funds to each other's projects and could become each other's strategic shareholders in future," Lam was quoted by state media as saying at the signing ceremony.
Vietnam's insurance sector has grown rapidly in recent years, in line with an economy which the government expects to expand 8.5% this year after growth of more than 8% in 2005 and 2006.
Source: Reuters
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