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May 31, 2022 / 11:10

Vietnam Airlines completes sale of 35% stake at Cambodian flag carrier

The airline plans to sell the remainder of its stake in Cambodia Angkor Air this year.

Vietnam Airlines announced the sale of 35% of its stake at Cambodia Angkor Air in deals worth US$35 million.

 An aircraft takes off at Noi Bai International Airport. Photo: Le Thanh

The deals were completed on January 3 and March 29 as the Vietnamese airline received respective $30 million and $4 million from investors purchasing the stake, along with a $1 million escrow.

In 2009, Vietnam Airlines acquired a 49% stake and became a major shareholder of Cambodia Angkor Air. Although the airline did not reveal the name of the buyer, it plans to sell the remaining 14% stake later this year.

Under the agreement, the Vietnamese airline would support its Cambodian peer in expanding operation and aircraft maintenance, along with other services. In 2021, Vietnam Airlines earned VND235 billion (US$10.1 million) from providing services for Cambodia Angkor Air.

Since the Covid-19 pandemic broke out in 2020, Vietnam Airlines planned to withdraw its stake from the Cambodian airline to cope with the severe impacts of the pandemic.

To overcome current difficulties, Vietnam Airlines have opted to restructure its operation and current investment activities.

In 2021, the airline accumulated losses of nearly VND22 trillion (US$963 million). The Government is currently Vietnam Airlines’ largest shareholder, holding 86.19% stake via the Commission for State Capital Management (CSCM), followed by government-investment arm State Capital Investment Corporation (SCIC) (31.14%), and Japanese aviation company ANA Holdings (5.62%).

As of December 31, Vietnam Airlines’ total assets stood at over VND63 trillion ($2.75 billion), and short-term debts of VND14.3 trillion ($626 million),  an increase by VND3 trillion ($131.3 million) from the beginning of the year.