A Ministry of Finance circular providing guidelines for the initial public offering (IPO) of equitised State-run companies will go into effect on February 15.

Expenses for the equitisation of an enterprise valued at over 100 billion VND (4.76 million USD) should not exceed 500 million VND (23,800 USD), the circular stipulates.

The maximum expense levels are 400 million VND for a company valued between 50 billion VND and 100 billion VND, 300 million VND for 30 billion VND to 50 billion VND, and 200 million VND for below 30 billion VND.

Share prices will be determined at auction, with an initial price no lower than the face value of 10,000 VND per share.

Prices of preferential shares reserved for company employees can comprise as much as 60 percent of the lowest winning bid, if a company hold public auctions before selling stakes to its strategic partners.

If the company sells shares before organising public auctions, preferential share prices can comprise as much as 60 percent of the lowest price determined through negotiation or bids with strategic partners.

A State-owned company must complete the IPO within three months of the day its equitisation plan is adopted by authorities, the ministry stipulates. Affiliates and subsidiaries are not allowed to take part in the IPO of their parent company./.