Indochina Capital Viet Nam Holdings Ltd (ICV) has announced an orderly liquidation of its entire ‘Vietnam Fund’ portfolio in 12-18 months.  The fund has been listed on the London Stock Exchange.  Recently it has been trading for far less than the net asset value of its underlying securities.

Vietnam Fund’s net asset value at the end of July was reportedly USD 243 million.  Principal shareholdings included Bao Viet Holding Co., Vietcombank, FPT, Vinamilk, Phu My Fertiliser Co., Germadept Corporation, Ree Electric Appliances JSC and Ninomaxx.

The ICV board announced the decision when shareholders reportedly holding 98 percent of its shares voted for liquidation.

Explaining the 65 per cent shareholder opt out, the fund said that around 40-45 per cent of the shareholders were arbitrage hedge funds that bought into ICV with the intention of generating short-term profit.

ICV expects fund’s liquidation to have a minimal impact on Viet Nam’s equities markets, emphasizing that its “investment policy has been devised to avoid indiscriminate selling of assets at fire-sale prices. No deadline has been set by which the entire portfolio has been realized.

The parent firm, Indochina Capital Group, reports that it is in good financial health and on course for the second best financial performance in its history in 2009. The group will continue to manage three real estate funds with a total committed capital of $450 million from large international financial institutions.