List of the largest M&A deals in Vietnam in 2016-2017
In 2016 and the first half of 2017, Vietnam has seen a series of multimillion dollar mergers and acquisitions (M&A) deals.
Here is the list of Vietnam’s top merger and acquisition deals (The List 50) announced at this morning press conference organised by VIR and AVM Vietnam.
Outstanding merger deals
1. TTC and Bien Hoa Sugar
Thanh Thanh Cong Tay Ninh Sugar JSC (TTCS) will make a share swap to fully acquire Bien Hoa Sugar Joint Stock Company (JSC) in order to become the biggest sugar producer in Vietnam.
TTCS will issue nearly 304 million shares to convert all outstanding shares of Bien Hoa Sugar at a ratio of 1:1.02.
The conversion ratio was calculated by a third-party company that valued the shares of TTCS and Bien Hoa Sugar at VND20,944 ($0.92) and VND21,356 ($0.94), respectively.
The deal will be carried out within 90 days (plus extensions if needed), starting from the day TTCS receives the permit from the State Securities Commission for the share issuance.
After the merger is completed, the chartered capital of TTCS will increase by VND3.04 trillion ($133.75 million), to VND5.57 trillion ($245.07 million). Besides, Bien Hoa Sugar will be renamed Thanh Thanh Cong Bien Hoa-Dong Nai Sugar Co., Ltd. to mark TTCS’s sole ownership.
Outstanding acquisition deals
1. Kido and Tuong An
On November 24 last year, foodstuff producer Kido Joint Stock Company (KDC) completed the purchase of a 65 per cent stake, equalling 12.34 million shares, in Tuong An Vegetable Oil JSC (TAC).
The official value of the deal has not been disclosed. However, in early November, KDC raised its offer, professing to its determination to buy TAC’s shares. Notably, KDC is willing to pay VND82,000 ($3.66) instead of the VND78,000 ($3.48) per share.
Thereby, the purchase value may reach VND1.01 trillion ($45.17 million).
2. Shinhan Vietnam and ANZ
In April 2017, ANZ Vietnam released plans to sell its retail banking arm to Shinhan Vietnam, a subsidiary of South Korean Shinhan Bank, by the end of 2017, to focus on its institutional banking activities in the country.
The agreement with Shinhan Bank Vietnam will include all eight branches and transaction offices located in Hanoi and Ho Chi Minh City, and keep all retail staff in their position. The deal value has been undisclosed.
3. CJ vs. Minh Dat and Cau Tre
In April, Saigon Trading Group (SATRA), the biggest shareholder of Cau Tre Export Goods Processing JSC, announced the public auction of a 20 per cent stake in the company.
Two subsidiaries of South Korean conglomerate CJ, CJ Foods Vietnam Ltd. and CJ CheilJedang Corporation, spent $12.4 million to buy 47.3 per cent of Cau Tre’s stake and raised CJ’s total holding to 71 per cent. On May 21, the shareholders of Cau Tre ratified the decision to change the company’s name to CJ Cau Tre.
Besides, CJ CheilJedang spent $13.44 million to acquire a 64.9 per cent stake in Minh Dat Food, considered the biggest Vietnamese private meatball company with a revenue of VND270 billion in 2016. The deal was reportedly made in secret in late 2016 and was only wrapped up officially in May. The company has changed its name to Minh Dat CJ Food and it is recruiting workers for its new development stage.
4. Earth Chemical buys Ai My Gia
In late March, Japanese Earth Chemical Group released plans to spend more than $80 million to buy the entire stake in Ai My Gia JSC, a Vietnamese home cleaning and hygiene producer with famous brands like Gift, Ami, and Redfoxx. According to Reuters, the deal was completed on May 12.
5. SCG buys Vietnam Construction Materials JSC (VCM)
In March, SCG Cement-Building Materials Co., Ltd., a member of Siam Cement Group (SCG), spent $156 million on buying up the shares of VCM.
The Bangkok Post quoted a statement from SCG as saying that the enterprise value (EV) of this transaction was $440 million, including a net debt and additional investment to improve the efficiency of the acquired assets.
6. Aviva and Vietinbank
In April, British insurance firm Aviva acquired a 50 per cent stake in domestic insurance firm Vietinbank Aviva from Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank).
The deal made Vietinbank Aviva (or Aviva Vietnam) a wholly-owned subsidiary of Aviva PLC. The value of the deal has not been disclosed.
The deal will help Aviva simplify its operations in the region and develop its business activities via key distribution channels.
7. Daesang Corp. and Duc Viet
In September 2016, South Korean food-producing conglomerate Daesang Corp. completed the acquisition of a 99.99 per cent stake in Vietnamese meat processor and distributor Duc Viet Food Joint Stock Company for $32 million, fetching the Korean company a bridgehead in the Southeast Asian meat processing market.
The purpose of buying Duc Viet Food is to reinforce its food processing business in Vietnam, currently centred on frozen ham products.
Previously, the two parties failed to complete the purchase, which was rumoured to be finished by August 5, because Daesang had yet to finish all necessary documents for the acquisition.
8. VIB and Commonwealth Vietnam
Early this month, Commonwealth Bank of Australia received the State Bank of Vietnam’s approval to sell its Ho Chi Minh City branch to local commercial lender Vietnam International Bank (VIB). Accordingly, VIB will acquire all the assets and liabilities of the foreign bank’s branch.
However, financial details were not disclosed.
Han Ngoc Vu, CEO of VIB, told DealStreetAsia that the transition process “will take several months.”
The Aussie bank earlier invested in VIB in 2009 and 2010 as a strategic partner and maintains a 20 per cent ownership. Its local branch was set up in 2008.
9. TTC Group and Hoang Anh Gia Lai Sugar
Bien Hoa Sugar Joint Stock Company and Tay Ninh Sugar Joint Stock Company, two subsidiaries of TTC Group, will take over the sugar operations of Hoang Anh Gia Lai in a bid to make TTC Group the biggest sugar producer in Vietnam in terms of output.
Accordingly, BHS is going to buy 60 per cent of HAGL Sugar from Hoang Anh Gia Lai Agricultural Joint Stock Company (HoSE: HNG). The long-term financial investment contract has a value of VND798 billion ($35.1 million) and will be carried out by the end of 2017.
TTC Tay Ninh Sugar will buy 40 per cent of HAGL Sugar from HNG and an individual shareholder. Though the investment has only been announced, HNG already assigned management positions and the right to operate the sugar factory, the sugar cane farm, and related assets to SBT.
Outstanding real estate project transfers
1. CapitaLand and Thien Duc Trading-Construction Company
In February, CapitaLand released news that its subsidiary CLV Investment 5 bought 20 per cent stake in Thien Duc Trading Construction Co., Ltd. for $17.9 million, raising CLV Investment 5’s ownership in Thien Duc to 50 per cent.
Besides, as of September 23, 2016, CapitaLand spent $51.9 million to acquire 100 per cent of Twin Peaks Developments Limited and 75 per cent of River View Company Limited.
2. An Gia, Creed, and Van Phat Hung
In March, An Gia Investment and Creed Group from Japan announced they had completed the acquisition of seven blocks of the Lacasa complex in Ho Chi Minh City’s District 7 from Van Phat Hung Group.
An Gia Investment bought two blocks in March 2015, and then, in collaboration with Creed Group, it continued acquiring the remaining five blocks in the second phase. The deal’s value was $40 million.
This is the sixth mergers and acquisitions (M&A) deal that An Gia has concluded in recent years.
3. Keppel Land and Southern Waterborne Transport Corp
Keppel Land—a leading Singaporean real estate developers—said on March 20 that it had spent $37 million on acquiring a 16 per cent stake in the group WATCO I to V, Keppel Land’s joint venture (JV) entities set up to develop Saigon Centre in Ho Chi Minh City, from partner Southern Waterborne Transport Corporation.
4. EXS Capital Ltd., ACA Investment, and SonKim Land
In May, SonKim Land Corporation, a leading Vietnamese real estate developer, and EXS Capital Ltd., an independent alternative investment group in Asia, announced the successful closure of their first round—$46 million out of an expected $100 million—of follow-up fundraising for SonKim Land.
This is the second investment led by EXS Capital in SonKim Land through the Lemongrass Master Fund, after a successful initial investment of $37 million in 2013.
For the follow-up investment, SonKim Land and EXS Capital are also partnering with ACA Investments, a leading Japanese fund management firm based in Singapore with a strong track record of investments across the Asia-Pacific.
Outstanding private equity and investment
1. Fraser & Neave Ltd. and Vinamilk
In December 2016, F&N Beverages Manufacturing Sdn., Bhd. and F&N Dairy Investments Pte., Ltd., the two wholly-owned subsidiaries of Fraser & Neave Ltd. (F&N), have completed the purchase of a total of 78.38 million shares, equalling a 5.4 per cent stake, in Vietnam Dairy Products Joint Stock Company (Vinamilk).
Accordingly, the two companies spent VND11.3 trillion ($499.56 million) on buying the registered share volume at the initial offering share price of VND144,000 ($6.33).
According to the latest news, F&N Dairy Investments Pte., Ltd. has expressed interest in increasing its stakes in Vinamilk via registering to buy an additional 14.5 million shares.
2. KKR and Masan Group
Masan Group Corporation (HOSE: MSN), announced on April 21 that leading global investment firm KKR has completed its $250-million investment in Masan Group and in its branded meat platform Masan Nutri-Science.
KKR’s investment is comprised of a $100-million purchase of secondary shares in Masan Group from PENM Partners, an independent Danish private equity company, and a $150-million primary investment in Masan Nutri-Science for a 7.5 per cent stake.
This is KKR’s second investment in Masan, after a $359 million invested in Masan Consumer. KKR will make the investment from its Asian Fund II.
3. Samsung Fire & Marine Insurance (SFMI) and PJICO
Petrolimex Insurance Joint Stock Company (PJICO), coded PGI on the Ho Chi Minh City Stock Exchange, will sell 20 per cent of its chartered capital to Samsung Fire & Marine Insurance.
The company will offer 17.74 million shares to Samsung Fire & Marine Insurance Co., Ltd., a leading non-insurance company from South Korea.
The company planned to issue the shares this year after the Ministry of Finance approves in principle to change PJICO’s chartered capital and the State Securities Commission also approves the transaction.
4. ACA Investments and Bibo Mart
In May, Bibo Mart JSC officially announced the investment from ACA Investments, Japan’s leading fund management company and an affiliate of Sumitomo Corporation.
With this investment, ACA Investments acquired 20 per cent of Bibo Mart’s stakes.
5. Sumitomo Bank and BIDV Financial Leasing Company
In February, a final agreement to expand a joint leasing business in Vietnam between the two parties has been reached by way of Sumitomo Mitsui Trust Bank, a subsidiary of Sumitomo Mitsui Trust Holdings, investing 49 per cent of the total equity of BIDV Financial Leasing Company (BLC), a subsidiary of BIDV, Vietnam’s biggest lender in terms of assets. The deal’s value reached $19.2 million.
6. UOB, ORIX Group, and Bitexco Power
In September 2016, UOB Venture Management Pte., Ltd. (UOBVM), a wholly-owned subsidiary of United Overseas Bank Limited, and financial company ORIX Corporation (ORIX), announced that they will each invest $25 million in one of Vietnam’s largest privately-owned hydropower companies, Bitexco Power.
7. Standard Chartered PE and N Kid
Standard Chartered Private Equity (SCPE), the private equity arm of Standard Chartered Bank, has poured $40 million into acquiring a 20 per cent stake in N Kid Corporation (N Kid), a Vietnamese lifestyle platform for kids and teenagers.
Enterprises with Best M&A Strategy
SCG, Kido Group, and CJ Group
Enterprises with Best M&A Information Publication
Vietjet, Kido Food, Vinamilk, Masan, SonKim Land, Aviva, and Commonwealth Bank. Almost all information about their deals have been published in a transparent and accurate manner.
Outstanding consulting companies
Viet Capital Securities JSC, Baker McKenzie, Vilaf, Allens, Bao Viet Securities Corporation, VP Bank Securities Company (VPBS), RongViet Securities Corporation, and Saigon-Hanoi Securities Corporation (SHS).