Sunday, August 9, 2020 1:45:10 PM - Markets open
VN-INDEX 841.46 +1.42/+0.17%
HNX-INDEX 112.78 -0.57/-0.51%
UPCOM-INDEX 56.22 +0.10/+0.18%
Retail, property deals dominate M&A market in 2016 - 1/5/2017 8:25:01 AM
 (0 ratings. You must sign in to rate.)
Many big and surprising merger and acquisition (M&A) deals were made in 2016 with retail and real estate continuing to dominate this market.

A deal that has attracted much public attention since late 2016 is the purchase of 78.38 million shares of the Vietnam Dairy Products Joint Stock Company (Vinamilk) through the stock market. The buyer is Singaporean food and beverage firm Fraser & Neave (F&N), owned by Thai billionaire Charoen Sirivadhanabhakdi.

If it is successful, F&N will have to spend at least VND11.3 trillion (over US$500 million), raising its ownership in Vinamilk from 11% to 16.4%.

In Q3, TCC Group of this Thai tycoon finished buying the entire wholesale network of Metro Cash & Carry Vietnam, including 19 centres and relevant real estate valued at EUR655 million (US$848 million).

Central Group, another Thai firm, also spent US$1.14 billion on acquiring all 32 supermarkets and trade centres of Big C Vietnam from France’s Casino Group.

Another big M&A deal is Thai group Singha’s becoming a strategic partner of Masan Group through buying 25 percent and 33 percent of stakes in Masan Consumer Holdings and Masan Brewery, respectively, at US$1.1 billion.

The purchase of Maximark by Vingroup, one of the local most dynamic, successful, well-capitalized companies in Viet Nam, with undisclosed value, is also considered a big deal, showing flourishing M&As in the retail and consumer goods sectors.

Dang Xuan Minh, head of a research group of the annual Vietnam M&A Forum (MAF), said retail and consumer goods M&As with the aim of entering and expanding market was the most outstanding trend in 2016.

The surging entrance of foreign retailers into Vietnam’s market and the opening of foreign-owned retail outlets through M&As, especially by Thai companies, in the last three years have turned the retail sector into a prime example in the local M&A market, he noted.

That fact was attributable to the modest proportion (less than 30%) of modern retail channels such as supermarkets, hypermarkets, shopping centres and convenience stores in Vietnam’s retail market, promoting this market’s attractiveness to foreign investors.

Tariffs on many goods will be removed as part of commitments in the ASEAN Economic Community with a population of over 600 million. Meanwhile, the maturity of Thailand’s domestic retail industry also encouraged this country’s retailers to expand overseas business, particularly in countries like Vietnam which has an almost 100-million-strong population, Minh added.

Even without multi-billion-dollar deals, real estate was still hot in the M&A market in 2016 with the participation of investors from the Republic of Korea (RoK), Japan and Singapore.

Notably, the RoK’s Mirae Asset cooperated with AON BGN to spend US$382 million on buying Keangnam Landmark 72 in Hanoi. Mapletree Investments, a Singaporean firm, declared that it acquired Kumho Asiana Plaza project in District 1, Ho Chi Minh City, at a cost of US$215 million from the Rok joint venture of Kumho Industrial and Asiana Airlines. New Life RE also purchased Duxton Hotel in District 1 at US$49.2 million from Low Keng Huat.

Domestic enterprises were also busy in property M&As in 2016. While TNR Holdings invested US$110 million in buying TNR Tower Hanoi from Vingroup, Vietnam’s Muong Thanh Group said it now owns 95% of shares at Cienco 5 Land after spending VND1.5 trillion on this purchase. Vietnamese Rang Dong Group also acquired a five-star resort complex in Binh Thuan province.

According to Stephen Wyatt, country head for Vietnam of global real estate advisor JLL, many foreign investment funds told JLL that they want to increase their presence in Vietnam through investment cooperation or buying existing projects, particularly profitable ones.

Although there hasn’t been detailed statistics, the MAF research group believed total M&A value in 2016 broke the record of US$5.2 billion set in the previous year.

Chris Freund, CEO of the private equity firm Mekong Capital, believed that M&As will keep vibrant in all fields, especially real estate, agriculture, consumer goods, retail and pharmaceuticals. All foreign clients that Mekong Capital has met are interested in those areas.

Sharing the same view, Alex Crane, General Manager at Cushman & Wakefield Vietnam, forecast retail M&As will continue booming in 2017, elaborating that many foreign businesses have yet to enter Vietnam’s retail market due to high office rental. Therefore, the best solution is M&A, usually through forming a joint venture with a Vietnamese enterprise.

Dang Xuan Minh, however, pointed out an array of challenges for M&A activities in 2017, including changes in the US’s policies, the uncertain future of TPP, obstacles to the equitisation of State-owned enterprises.

To have an M&A value comparable to that of last year, the State must make strong moves to divest its stake in big groups and corporations, he said.
Newer News
18/06 COVID-19 could shake up realty rent market
10/06 Property firms return to market after COVID-19
28/03 Association calls for tax incentives for social housing developers to be consistent
01/03 Residential suburban projects prove alluring to buyers
23/02 Ownership certificates for condotels could solve market issues: experts
09/02 Hải Phòng eyes new industrial zones this year
01/02 Local property market to recover this year
28/01 Vietjet launches Hà Nội- Bali route
11/01 Support industry promotes development of industrial real estate
23/12 Domestic property market to have enough capital next year
Older News
27/12 Hot cash flow in the real estate market in 2017
23/12 Experts present three scenarios for property market next year
21/12 Multi-house owners won’t be taxed in 2017
21/12 Real estate bubble unlikely next year: HoREA
20/12 Experts: realty bubble on horizon
12/12 Property inventory value reduced
12/12 Top developers eye affordable housing
19/11 Third investment wave from RoK now at peak
18/11 Less cash to flow into real estate
16/11 Housing market keeps developing
Newsletter Signup
Top Stories
GDP forecast to grow 3.8 percent this year
New regulations about corporate bond issuance
Reference exchange rate remains unchanged
New traders flock to market
Reforms needed to attract foreign portfolio investment: fund manager
Market Update
Last updated at 3:09:56 PM
VN-INDEX 841.46 +1.42/+0.17%
Real-time chart
Top 5 Actives
Top 5 Gainers
Top 5 Losers
My Favorite Quotes
Your most recently viewed tickers will automatically show up here if you type a ticker in the Get Quotes box on the top of the page.
Company Research
Type in the symbol above for thorough background information, key statistics and financial information.
Stock Sectors
We continuously improve our services, here are the latest updates...
Allow you to monitor a customised group of securities. You can set up multiple Portfolios to help you better manage your investments.
Trigger Alerts
Get up-to-date alerts delivered directly to your email address.
Stock Screener
Allow you to filter the market and find exactly what sort of company you are looking for.
Live Terminal
Get instant access to FREE REAL-TIME streaming quotes for hundreds of stocks from HOSE, HNX and UPCOM exchanges.