State-owned Vietnam Shipbuilding Industry Group, or Vinashin, has said it will set up new joint ventures with the Malaysian-based budget airline AirAsia and Lion Group to form a new carrier and build a steel mill in central Vietnam.
A Vinashin official told the Daily that a letter of intent for the establishment of a low-cost carrier in Vietnam was signed between AirAsia and Vinashin Group in the Malaysian capital last Friday.
AirAsia chief executive officer Tony Fernandes and Vinashin chairman and CEO Pham Thanh Binh signed the agreement in the Malaysian capital of Kuala Lumpur, with the participation of Vietnam's Prime Minister Nguyen Tan Dung who was there for the celebration of Malaysia's 50th nationhood.
The airline venture will also make AirAsia the second foreign investor to hold a stake in a Vietnamese airline after Australia's Qantas Airways Ltd., which spent US$50mil acquiring a 30% stake in Pacific Airlines in April this year.
The new carrier, which will be called Vina AirAsia, will initially have a fleet of nine, aircraft with the shipbuilder holding a 70% stake and AirAsia the remaining 30%.
In the letter of intent, AirAsia and Vinashin will establish a joint-venture company with total estimated capital of US$30mil. Both will establish the low-cost airline in Vietnam based on AirAsia's successful business model.
This deal is another move taken by AirAsia to further tap the increasingly lucrative civil aviation market in Vietnam.
The planned venture will include securing a license to operate the new Vietnamese airline to serve domestic, regional and international routes.
According to the letter of intent, Vinashin will help the joint venture secure regulatory approval from the aviation authority as well as concessions, permits, licenses, certificates and any other approval necessary for the working of the new airline.
Meanwhile, AirAsia will help acquire aircraft at the most competitive price and will also provide aviation and other technical expertise, technology transfer in the purchase and leasing of aircraft, engineering and maintenance services, pilot and cabin crew training, and airline marketing, distribution, franchising and branding skills.
Both two sides plan to formally sign a contract on September 20 and Vina AirAsia is planed to begin service in July 2008.
Under Vietnamese law, foreign investors are permitted to own up to 49% of a joint-stock air carrier. Currently, Vietnam is home to three airlines - Vietnam Airlines, Pacific Airlines and Vasco.
AirAsia has been successful in the Hanoi-Bangkok and the Hanoi-Kuala Lumpur services though it only launched the first route in October 2005 and the other in October last year.
The seat occupancy averages 80% for the three daily Hanoi-Bangkok flights and the two daily flights between Hanoi and Kuala Lumpur.
AirAsia is now preparing to begin the service to HCMC, hopefully this year to attract more passengers traveling between Vietnam and the two countries.
"The growth potential in Vietnam's air travel market is significant and we are very excited to be working with a colossal corporation in Vietnam to develop this opportunity," said Fernandes of AirAsia.
"We are very confident that both parties will enjoy not only a productive and profitable outcome together but also the exchange of fresher ideas, skills and technologies."
On the same day, Vinashin signed a deal with Malaysia's Lion Group to build a giant steel mill worth up to US$7.3bil in central Vietnam.
The facility will be built in Ninh Thuan Province to produce eight million tons of steel a year. Investment would be US$2.8bil for the first phase while another US$4.5bil would be spent in the second phase.
The signing of this deal was also witnessed by Prime Minister Dung.
Source: VNE
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment