MobiFone may lose more than 700 billion VND if it does not withdraw from AVG

In a statement issued on the afternoon of March 13, the Ministry of Information and Communications said it had approved the policy of allowing MobiFone to negotiate the termination of the contract to purchase 95% of AVG shares.

According to the Ministry of Information and Communications, the fact that MobiFone has not paid 5% of the contract value is the reason why AVG can unilaterally terminate the contract. Not only that, MobiFone can be fined up to 8% of the contract value. Thus, with the transfer contract value of 8,889.8 billion VND, the amount of money MobiFone can be fined could be equivalent to more than 711 billion VND.

Therefore, the Ministry believes that early termination of the contract ensures no loss of capital to MobiFone and the State in accordance with the direction of the Party Central Committee Secretariat.

According to MobiFone leaders, the delay in payment is due to the company having to comply with regulations for state-owned enterprises, which is to complete the project settlement. However, due to the inspection, the settlement has not been completed.

For its part, although it can unilaterally terminate the contract with MobiFone, the group of shareholders transferring to AVG said it wants to reach an agreement, and is even willing to support the costs related to the transaction and pay interest to MobiFone on the amount already paid.

The Ministry of Information and Communications also confirmed that MobiFone will receive a larger amount than what it paid to AVG shareholders because it will also be paid interest and related expenses.

On the same day, MobiFone also released information stating that AVG had deposited 450 billion VND to commit to canceling the transfer contract. However, this is the remaining 5% of the contract value that MobiFone has not paid to AVG. According to the agreement between the two parties, AVG deposited for the liquidation of the transfer contract worth more than 8,889.8 billion VND with the same amount that MobiFone has not paid according to the schedule.

MobiFone said it is working with AVG shareholders to promote the cancellation of the share purchase agreement contract in accordance with legal regulations.

On the same day, the Ministry of Information and Communications also reported to the Secretariat, the Government Standing Committee, and the Government Inspector General about the cancellation of the share transfer agreement between MobiFone and AVG.

Previously, after a 6-hour meeting on March 12,MobiFone and AVG have agreed to cancel the transfer of 344.66 million shares and return to each other what they received under the agreement. The total value of this transfer contract is VND8,889.8 billion.

AVG representative, Mr. Pham Nhat Vu said that he will refund the entire amount MobiFone paid. MobiFone will also return to AVG the shares and assets that were transferred. At the same time, both sides "will try to ensure that neither side suffers any damage from this."

The above meeting took place after the Party Central Office issued an official dispatch on the handling of the MobiFone contract to buy AVG shares. Accordingly, the Secretariat said that this is a "serious, complicated, sensitive case, of special concern to public opinion". The responsible agencies should promptly review and handle the case to ensure objectivity and accuracy in a resolute, strict spirit, clarifying and handling the case to the right person, right violation, right law and recovering lost state assets.

Nguyen Ha