The national flag carrier Vietnam Airlines (VNA) is expected to select a strategic investor in the fourth quarter of this year to prepare its initial public offering (IPO) next year.

VNA representative told Bloomberg that the equitization is considered a “critical mission" in 2013 and is accelerating this process "as quickly as possible."

A business valuation report of VNA is expected to be completed this month to be submitted to state authorities for approval, Bloomberg reported.

The equitization plan of VNA is brought back to life after a local private carrier, VietJet Aviation Joint Stock Co – the operator of VietJet Air, announced last week that it was considering an IPO in the next 18-42 months to find more funding for expansion.

Last week, VietJet told Bloomberg that it earned a pre-tax profit of VND120 billion ($5.64 million) in the first 7 months of the year, so it is eyeing the IPO for more aggressive move.

Though just started flying from December 2011, VietJet has occupied 20 percent of total domestic flight seats, compared with 67 percent of VNA, according to a report from research firm Aviation CAPA Centre for Aviation.

“VietJet will add planes as it focuses on the local market and plans more routes overseas, with passenger growth in the Asia-Pacific region to surpass that in Europe and North America through 2016,” Bloomberg quoted a forecast by the International Air Transport Association.

The sale would help fund expansion that would include international markets beyond Bangkok, its only current overseas destination, Bloomberg reported.

The government began to push the IPO of VNA since 2010. As planned, the national flag carrier will launch its IPO in the second half of 2014, after the 2012 IPO plan was delayed twice.

VNA said it is working with consultants, including Morgan Stanley and Citigroup, for asset evaluation for equitization.

In March last year, VNA CEO Pham Ngoc Minh said that the stock market is attractive for VNA to sell shares then. But the benchmark VN-Index of Ho Chi Minh Stock Exchange has fallen 11 percent since the June 7 peak this year.

In the first 6 months of this year, VNA carried 7.3 million passengers, up 6.4 percent from the same period last year.

The airline said it expected to transport 14.4 million passengers this year, up from 13.5 million passengers in 2012.