Tycoons spend billions of dong to acquire foreign firms

09.06.2016

Analysts once commented that Vietnamese famous brands would, sooner or later, fall into the hands of foreign conglomerates, which have powerful financial capability and an ambition to conquer the Vietnamese market.

In most merger & acquisition (M&A) deals made in recent years, the buyers were foreign investors.
However, times have changed.  Vietnamese tycoons, in their plans to conquer the overseas markets, are willing to spend billions of dong to take over foreign firms.

 

Vinamilk, the nation’s leading dairy producer, has announced it would invest $3 million into Driftwood in the US. With the deal, Vinamilk’s total investment in the dairy producer would increase to $10 million, or VND230 billion, and its ownership ratio would be raised from 70 percent to 100 percent. 

Prior to that, in 2014, Vinamilk poured $7 million into the California-based company which specializes in making and distributing dairy products, fruit juice and snacks. 

In 2012, Driftwood reported the turnover of $100 million, but it still could not make profit.

Some days ago, Hung Vuong JSC, a large seafood producer and exporter, revealed a plan to acquire a Russian company. 
Hung Vuong’s CEO and chair has consulted with shareholders about the plan to buy 51 percent of stakes of Russia Fish, a company specializing in seafood product trade, distribution and retailing in Russia.

Sources said that the ‘seafood King’ Hung Vuong would spend $15 million, or VND345 billion to acquire the Russian company.
Explaining the plan to take over the Russian seafood company, Duong said it is the leading fish distribution company in Russia which holds 5 percent of the market share. 
The company has a large distribution network with 19 branches and 13 representative offices throughout Russia. Its post-tax profit was 1.2 billion rubles, or $15 million, in 2015.

Prior to that, Masan Group stirred up the public when announcing the deal to acquire a 52 percent stake of Proconco, an animal feed producer and 70 percent of Anco through the purchase of 99.99 percent of Sam Kim Company’s shares. Sam Kim was later renamed Masan Nutri-Science.

A financial report showd that Masan’s net turnover reached VND8.769 trillion in the first quarter of 2016, an increase of 144.6 percent over the same period ladt year. Of this, Masan Nutri-Science contributed VND5.183 trillion, or 59.1 percent of total revenue.

Source:  Vietnam.net

Photo: CBR Investment AG