M&A deals in 2024 will mainly focus on industries with strong growth potential such as technology, real estate and consumer.
In 2024, the mergers and acquisitions (M&A) market in Vietnam witnessed a strong wave of transactions, creating a vibrant and hopeful atmosphere. M&A deals this year mainly focused on industries with strong growth potential such as technology, real estate and consumer.
1. Vingroup divests 100% of capital from the company that owns Vincom Retail
Vingroup Corporation – JSC (HoSE: VIC) indirectly divested from Vincom Retail, the operator of more than 80 shopping malls nationwide, through the transfer of 55% of capital at SDI Investment and Development Company Limited to a group of enterprises based in Ho Chi Minh City. The transaction value is up to 982 million USD.
In mid-March 2024, Vingroup officially approved the decision to divest 100% of its capital at SDI Company, which owns more than 99% of the capital of Sado Trading Company – a major shareholder of Vincom Retail. After the divestment is completed, SDI, Sado and Vincom Retail are no longer subsidiaries of Vingroup.
At the time of announcement, Sado held 40.5% of Vincom Retail’s capital with 943.2 million shares, while Vingroup directly owned 18.37% of the capital.
Vice Chairman of the Board of Directors and General Director of Vingroup, Mr. Nguyen Viet Quang shared that the transfer aims to focus resources on key brands for breakthrough development in the new period. Despite the divestment, Vingroup will sign a management contract with Vincom Retail, maintaining the organizational model and tenant rights at the shopping centers as committed.
As of the third quarter of 2024, Vingroup has completed the sale of 100% of its capital at SDI Investment and Trade Development Company Limited. This transaction helped Vingroup earn VND39,100 billion (equivalent to USD1.54 billion). After the transfer, Vingroup still owns more than 18% of Vincom Retail.
The enterprises receiving the transfer of capital contributions at SDI from Vingroup are NP Investment and Business Joint Stock Company, Emerald Investment and Business Development Joint Stock Company, Falcon Investment and Development Company Limited, and Thien Phuc Investment and Business Development Company Limited. These are enterprises related to the Malaysian multi-industry group Berjaya Corporation Berhad.
With a value of about 982 million USD, Vingroup’s divestment from Vincom Retail becomes the largest M&A deal in 2024 (up to this point).
2. Becamex IDC sells Tan Thanh Binh Duong project
In the real estate sector, the Industrial Development and Investment Corporation (HoSE: BCM) also contributed to a prominent deal in the market when transferring a housing project worth 553 million USD in Binh Duong to Sycamore Limited, a subsidiary of CapitaLand Group (Singapore).
This deal was approved by the People’s Committee of Binh Duong province at the end of 2023 and implemented in 2024.
Accordingly, Becamex IDC transferred the Tan Thanh Binh Duong urban and housing project to Sycamore Company Limited under CapitaLand – one of the largest real estate corporations in Asia, headquartered in Singapore.
The deal value as announced by Avison Young is up to 553 million USD (about 13,8000 billion VND).
3. Masan Group raises $250 million from Bain Capital
On April 23, 2024, Masan Group Corporation (HoSE: MSN) announced that it had successfully completed the capital mobilization of $250 million in equity capital from Bain Capital – a private equity fund with approximately $180 billion in total assets under management. This is Bain Capital’s first investment in Vietnam.
Accordingly, Masan received VND 6,228 billion in net cash from this investment.
This is an equity investment in the form of convertible dividend preference shares, issued at VND85,000 and will be converted into common shares at a ratio of 1:1. The fixed dividend rate is 0% for the first 5 years. From the 6th year, the fixed dividend rate is 10% per year. In the 10th year from the date of issuance, these preference shares will be compulsorily converted into common shares.
Masan said the $250 million capital injection will strengthen its resources, increase liquidity to meet all financial obligations, and provide the company with flexibility to implement strategic initiatives. Previously, the company said it was focusing on reducing the proportion of non-core businesses, increasing liquidity and achieving a sustainable net debt to EBITDA ratio of below 3.5 times.
Established in 1984, Bain Capital has a long history of investing to support the growth and management of consumer retail groups in Asia, including investments in Schwan and Carver Korea. According to Masan, the transaction demonstrates the investor’s confidence in the growth story of the consumer market in Vietnam, as well as Masan’s ability to realize the opportunity to serve 100 million domestic consumers.
4. Keppel sells 70% of capital of the investor company of Saigon Sport City project
Keppel – Singapore’s leading real estate group, through its subsidiary Jencity, is divesting 70% of its capital from Saigon Sport City Company Limited – the investor of the 64-hectare project of the same name, with a total investment of 500 million USD, in Thu Duc City, Ho Chi Minh City, which has been behind schedule for the past 6 years.
The total value of the deal is said to be between S$344 and S$391 million (equivalent to VND6,500 and VND7,450 billion). The transferees are HTV Dai Phuoc Company Limited (will buy 35%) and Vinobly Real Estate Joint Stock Company (will buy 35%).
In addition to the above deal, another notable development related to Keppel also took place. Specifically, Japanese company Toshin Development (member of Takashimaya Group) will spend about 46.4 million USD to buy nearly 46.4 million new common shares of Himawari VNSC3 Pte Ltd – a subsidiary of Saigon Centre Investment Ltd.
Himawari VNSC3 Pte Ltd is holding Class C preference shares in Keppel Land Limited and Krystal Investment Pte Ltd – the two companies holding 68% and 16% respectively in Keppel Land Watco-IV Co., Ltd and Keppel Land Watco-V Co., Ltd – the companies holding land use rights for the Saigon Centre Phase 3 project.
4. Gelex divests capital from three subsidiaries in the renewable energy sector
GELEX Group Corporation (HoSE: GEX) stands out with its M&A deal in the renewable energy sector with Sembcorp, a leading corporation in the energy and urban sectors of Singapore.
The transaction is expected to take place from 2023. GELEX said it has signed an investment cooperation agreement with Sembcorp Industries. By 2024, the two sides will realize the relationship by Sembcorp Industries acquiring shares or capital contributions in operating energy projects belonging to GELEX Group. To date, 3/4 of the projects have completed the transfer.
On June 19, 2024, Sembcorp announced the completion of the acquisition of a majority stake in three subsidiaries of Gelex. Following the transaction, Sembcorp added a total of 196 MW of operating solar and wind capacity to its portfolio.
Sembcorp will also acquire a 73% stake in another subsidiary of Gelex, which owns a 49MW hydropower plant. Completion of the M&A deal is subject to regulatory approval, expected in the second half of 2024.
Despite divesting from a series of important members, sharing at the 2024 Annual General Meeting of Shareholders, Chairman of the Board of Directors Nguyen Trong Hien affirmed that energy is still one of Gelex’s major investment areas.
“Divestment is part of the group’s strategy, not to completely divest from this sector but to partially divest from operating projects to select partners with financial and technological capacity and the ability to implement large-scale renewable energy projects, to accompany Gelex in the next projects,” said the Chairman of Gelex’s Board of Directors.
5. Mitsui & Co., Ltd. (Mitsui) becomes a strategic shareholder of Tasco Auto
In mid-August 2024, Tasco Auto and Mitsui & Co., Ltd. (“Mitsui”) announced that they had completed an agreement for Mitsui to become a strategic shareholder of Tasco Auto – a member unit of Tasco Joint Stock Company (HNX: HUT) and accompany Tasco Auto to implement many development plans and strategies in the coming time. However, the investment value of this deal was not disclosed. According to Tasco (Tasco Auto’s parent company), the Japanese side will disburse capital in several installments and the first installment was completed on July 31.
Mitsui & Co is a leading Japanese trading and investment group, currently present in more than 60 countries and territories, operating in many different fields with more than 53 thousand employees. In particular, the automobile and transportation sector is one of Mitsui’s investment focuses, with more than 100 companies in 26 countries in their investment portfolio.
Tasco Auto – a member of Tasco’s ecosystem, owns the largest distribution system in the country, a partner of 14 car manufacturers with 90 showrooms, contributing about 13.3% of the market share. In addition, this group is also the official importer of a number of brands such as Volvo (through Sweden Auto), Lynk & Co (through GreenLynk) and is implementing a car assembly project with a partner in the top 10 global OEM manufacturers, expected to launch products in 2025.
Tasco said this deal helps them take advantage of the operating, management and existing network experience from the partner. In return, Mitsui will participate more deeply in the automobile and transport infrastructure sectors in Vietnam.
6. DB Insurance acquires BSH and VNI, expanding Vietnam’s insurance market
On February 27, Saigon – Hanoi Insurance Corporation (BSH, UPCoM: BHI) and Aviation Insurance Corporation (VNI, UPCoM: AIC) officially announced the completion of the transfer of controlling shares to DB Insurance – a large insurance group from Korea.
DB Insurance has acquired 75% of the shares of both BSH and VNI, bringing these two non-life insurance companies into its strategic investment portfolio in Vietnam.
VNI (AIC): In the trading session on January 31, more than 75 million AIC shares were transferred, equivalent to 75% of charter capital. The transaction value reached VND1,263 billion.
BSH (BHI): DB Insurance made 21 negotiated transactions, buying 75 million BHI shares, with a total value of VND 1,628 billion.
In total, DB Insurance spent about VND2,800 billion to acquire these two businesses.
In addition to BSH and VNI, DB Insurance is also a major shareholder of Post and Telecommunication Insurance Corporation (HNX: PTI). Since 2015, DB Insurance has owned 30 million PTI shares, accounting for 37.3% of charter capital.
DB Insurance’s strong presence in Vietnam reflects the group’s long-term strategy in exploiting the growth potential of the non-life insurance industry in a fast-growing market like Vietnam.
The total value of these two deals is estimated at 118 million USD. These are typical M&A deals in the insurance industry in 2024.
7. KIDO acquired more than 75% of Hung Vuong Plaza shares
In August 2024, KIDO purchased 39.41%; 18.64% and 17.34% of shares of Hung Vuong Joint Stock Company – owner of Hung Vuong Plaza shopping mall, respectively, increasing the total ownership ratio to more than 75%.
After the transaction, KIDO’s ownership in Hung Vuong reached nearly 18.2 million shares, equivalent to 75.39%, thereby controlling the enterprise. The value of the investment capital here is 1,130 billion VND.
Hung Vuong is the owner of Hung Vuong Plaza shopping mall at 126 Hong Bang, Ward 12, District 5, Ho Chi Minh City. This shopping mall consists of seven commercial floors with underground and outdoor parking lots with four street frontages, about 200 stores and brands in operation.
Before officially falling into the hands of KIDO, Hung Vuong Plaza had gone through many ups and downs as a famous shopping destination under the management of Parkson. However, this shopping mall faced a long period of gloomy business, leading Parkson Vietnam to file for voluntary bankruptcy in April 2023. After Parkson left, this shopping mall re-launched under the new name Hung Vuong Plaza, opening from October 12, 2023.
8. Sabeco completes the acquisition of Sabibeco
On December 26, Saigon Beer – Alcohol – Beverage Corporation – Sabeco (HoSE: SAB) announced a successful public offering to purchase more than 37.8 million SBB shares of Saigon Binh Tay Beer Group Joint Stock Company (Sabibeco – UPCoM: SBB).
After the transaction, Sabeco increased its ownership to nearly 52.2 million SBB shares, a 59.6% ownership ratio, and became the parent company of Saigon Binh Tay Beer. The total value of the transaction reached VND832 billion.
Sabibeco Group, formerly known as Saigon Binh Tay Beer Joint Stock Company, was established in 2005 and is currently Sabeco’s largest processing partner. With 6 member factories and a total capacity of up to 600 million liters of beer per year, Sabibeco offers customers many famous beer brands such as Sagota, Saigon Lager, Saigon Special and Saigon 333 Export…
Sabeco’s M&A deal is a strategic move, not only increasing its scale but also strengthening Sabeco’s position in the competitive alcoholic beverage industry.
Sabeco’s total capacity is expected to increase by 25.4% to 3.01 billion liters of beer per year by 2024, making Sabeco the largest beer producer in Vietnam.
