The Vietnam Post and Telecom Group (VNPT) has entered into a cooperative deal with Vietnam's largest insurance firm Bao Viet to support mutual development.
Under the deal signed Monday in Hanoi, VNPT and Bao Viet Insurance Corp will work together as strategic partners, each reserving a major chunk of shares for the other to purchase on a mutual basis.
The leading telecom provider will support Bao Viet to develop advanced IT applications in the top insurer as well as its affiliates.
In return, the insurer would provide insurance services for VNPT’s business activities.
The new formal strategic cooperation with a leading insurer will enable VNPT to expand services and develop financial operations with the telecom business.
They will also assist each other in training staff, according to the agreement.
VNPT is in talks with the Bank for Development of Vietnam (BIDV) as a strategic partner to either set up or control a major portion of stakes in companies involved in the country’s forthcoming key mega projects.
These comprise the express way connecting the Ho Chi Minh City – Long Thanh – Dau Giay, the Vietnam-Laos Hydropower plant, Vietnam – Cambodia Hydropower plant, and a bank for trade, industry and services of Vietnam.
VNPT, last year, became a member of the ASEAN Telecom Holding Company (ATH/ACASIA), one of the Association of Southeast Asian Nations (ASEAN)'s leading primary network service providers, made up of the six leading telecom providers in the region, namely CAT, Indosat, JTB, PLDT, Singtel and Telekom Malaysia.
Bao Viet is set to offer an 18% stake to foreign investors while the state will retain 65.34% of ownership.
The top insurer will auction more than 59.4 million shares or 8.74% of the firm's total to the public and 0.7% to employees and the remaining 7.22% to strategic investors.
Further details on the auction were not available.
Bao Viet group has a registered capital of VND6.8 trillion (US$422) million.
Bao Viet Securities, a subsidiary of Bao Viet, listed on the Hanoi exchange last December.
The securities firm is a new business of Bao Viet which has said it would diversify into banking, financial leasing, real estate and public health insurance.
Vietnam's insurance sector has grown rapidly in recent years in line with the economy, which is targeted to expand 8.5% this year after growth of more than 8% in 2005 and 2006.
Source: Thanh Nien
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