* Stake sale would be for investment in petrochemical products
* Maximum sale of 49 pct shares, foreigners allowed up to 44 pct
* Stake sale switched to public auction instead of strategic sale (Adds details, CEO quotes)
By Mai Nguyen and Khanh Vu
HANOI, June 13 (Reuters) - Vietnam’s Binh Son Refining and Petrochemical will offload a further 49 percent stake and not limit the sale to only strategic investors as previously planned, in order to attract more buyers, its chief executive said.
The sale is expected to take place via a public auction ahead of state-owned Binh Son’s possible listing in April next year, CEO Tran Ngoc Nguyen told Reuters, adding proceeds will be used for long-term investment in petrochemicals products.
In an IPO earlier this year, the Vietnamese government raised $245 million by selling a 7.79 percent stake in Binh Son, the operator of the $3-billion Dung Quat oil refinery.
At the time, Binh Son had said it would sell a further 49 percent stake to strategic investors, including domestic and foreign investors.
But the refinery operator has so far failed to find a strategic investor, CEO Nguyen said.
“The timing is too short for strategic investors to decide to invest in such a big stake,” he added.
BSR also hopes to ease requirements such as lock-up time and minimum registered capital for the planned sale, Nguyen said, adding he expected the government to approve the change in order to help speed up the process.
Vietnam has been privatising hundreds of state-owned enterprises in order to boost their performance, relax a tight state budget and reform an economy that is highly reliant on foreign investments.
Binh Son’s foreign ownership is capped at 49 percent. It is currently 5 percent owned by foreigners, indicating overseas buyers may take up to 44 percent in the upcoming sale.
Shares of the company have been trading on the unlisted public company market, or UPCoM, since March, and Nguyen expects the shares to be listed on the Ho Chi Minh Stock Exchange , the country’s main bourse, by April next year.
Binh Son expects to rake in a net profit of 2.95 trillion dong ($129 million) in the first half of this year, or about 85 percent of its full-year target, it said in a statement.
The company will use retained profits as well as loans to fund a planned upgrade of its Dung Quat refinery.
Dung Quat, Vietnam’s first refinery that began operations in 2009, was initially designed to process light sweet crude oil, mostly sourced from the Bach Ho field offshore Vietnam.
The upgrade will enable the plant to process sour crude oil as well, Nguyen said, and will also allow it to produce more petrochemical products.
Binh Son will select an engineering, procurement and construction contractor for the upgrade next year.
Nguyen said seven companies had registered to bid for the contract, but declined to name them. ($1 = 22,810 dong) (Reporting by Mai Nguyen and Khanh Vu; Editing by Richard Pullin and Himani Sarkar)