Experts have predicted a banner year for merger and acquisition (M&A) activities in 2019 thanks to recent positive developments.
According to Vice Chairman of the Vietnam Foreign Investment Business Association Nguyen Van Toan, M&A deals surged 160 percent to 9.9 billion USD in 2018, making disbursement of foreign direct investment (FDI) hit a record of 19.1 billion USD in the year.
This shows foreign investors’ increasing confidence in Vietnam as well as achievements in state divestment and equitisation, he affirmed.
Toan said Chinese enterprises will shift their investment strategies by pouring more capital into building plants in Vietnam to take advantage of its integration commitments within ASEAN , ASEAN and other free trade deals.
Despite expressing her optimism about M&A market in 2019, Dr Nguyen Thi Viet Nga from the Academy of Finance said the sector still faces challenges.
As there are no full details for M&A in Vietnamese documents and laws, it is difficult for state agencies to manage and businesses to engage in the activities, she said, adding that lacking competence about the field stops local firms from finding suitable partners.
Serving as brokers for M&A deals, securities, financial and audit companies have not performed their roles well due to limitations in regulations, human resources, professionalism and information.
Nga also said opaque financial reports and overvaluation of M&A deals affect FDI attraction in the field.