Vilaf is proud to be involved as local adviser for KKR, Unicharm and Vincom in the list below:

The global financial crisis has put pressures on the Vietnamese economy with problems of inflation and interest rates and many small and medium-sized enterprises (SMEs) as well as larger firms have met financial and human resource difficulties.

Mergers and acquisitions are considered a good solution to bail out SMEs and allow larger companies to restructure their operations. They also present opportunities for foreign firms to capitalise on available resources of local enterprises when tapping into the Vietnamese market.

1. IFC buys 10 per cent stake in Vietinbank

Earlier this year, Vietinbank issued a 10 per cent stake to the International Finance Corporation with a total value of US$182 million. This move was seen as an archetypal deal where a global financial institute is moving in on a growing bank.

Vietinbank also planned to sell a 15 per cent stake to the Bank of Nova Scotia, but they have not yet finalised a deal.

2. KKR pours $159m into Masan Consumer

The New York-based Kohlberg Kravis Roberts Co (KKR), one of the largest private equity investors in the world, has spent $159 million buying a 10 per cent stake in the joint stock Masan Consumer Company.

This is the first time that KKR has invested in Viet Nam and it is also the biggest share issue among unlisted firms in 2011.

KKR paid more than $11 for each share of Masan Consumer, which is a subsidiary of Masan Group (MSN), with a series of products such as Chinsu fish and soy sauce and Omachi and Tien Vua noodles. Masan Consumer has also enjoyed strong business growth in recent years.

3. Masan Consumer acquires Vinacafe Bien Hoa

 Masan Consumer made a tender offer of 13.32 million shares of Vinacafe Bien Hoa (VCF), or the equivalent of 50.1 per cent of VCF's total shares.

With the bid reaching VND80,000 (US$3.8) per share, the total amount Masan Consumer are looking to spend on acquisition climbed to VND1.07 trillion (nearly $51 million).

4. Unicharm acquires 95 per cent stake in Diana

The Japanese Unicharm company, via a subsidiary in Thailand, has acquired a 95 per cent stake in the Diana company, worth close to $128 million.

Unicharm specialises in sale of baby and child care products, female care products, health care products, cosmetic products, household products, pet care products, industrial materials and food-packaging materials. Diana is also one of the leading domestic companies in manufacturing sanitary napkins and diapers.

The acquisition partly represents a trend in Japanese companies buying stakes of Vietnamese companies.

5. FPT consolidates three subsidiaries

 FPT has decided to consolidate subsidiaries FPT Software, FPT IS and FPT Trading Located, as part of their OneFPT strategy. Under the plan, the company aims to merge its information technology and telecommunications units into a unified group.

The deal highlights a trend in consolidating subsidiaries of large businesses.

Shares of the three companies were converted into nearly 20 million shares of FPT.

It is expected two other subsidiaries, FPT Telecom and FPT Online, will also be incorporated if the move is seen as successful.

6. Vinpearl merges into Vincom

 Early in 2011, three affiliates of Vinpearl Da Nang, Vinpearl Hoi An and Vincharm, merged into Vinpearl, which itself then merged into Vincom.

This is the biggest merger between the two listed companies because both Vincom and Vinpearl were listed in the top five businesses with the largest capitalisation in the HCMC Stock Exchange. The merger has a charter capital of nearly VND5.5 trillion and a total capitalisation of more than VND50 trillion.

7. Three banks unify for the first time

Shareholders of Saigon Commercial Bank (SCB), Viet Nam Tin Nghia and De Nhat Bank (Ficombank) have agreed to merge into a new bank named SCB. This is the first merger in the country's banking sector.

The new bank is expected to have a charter capital of more than VND10 trillion.

8. CP Pokphand buys 71 per cent of CP Viet Nam

Thailand's Charoen Pokphand Group has sold a 70.8 per cent stake of Charoen Pokphand Viet Nam to its Hong Kong-based subsidiary – C.P Pokphand in a deal valued at up to $609 million.

It is one of the largest ever deals in Viet Nam, but is technically an acquisition by foreign investors.

CP Viet Nam is one of the leading manufacturers of animal feed and aqua culture feed in the country.

9. Xuan Thanh Group acquires Vincom Securities

Vincom Joint Stock Company sold a 75 per cent stake of its Vincom Securities Company to the Xuan Thanh Group, that is active in various sectors including construction, real estate, taxis, insurance, cement, minerals and hydro-power. The firm was then renamed Xuan Thanh Securities Company.

This deal was seen as typical of acquisitions among security firms.

10. Diageo buys Halico shares

 The British drink company Diageo bought 6 million shares of Joint Stock Company Ha Noi Alcohol (Halico) through subsidiary Streetcar Investment at the record price of VND213,600 per share significantly above its stock trading price. The deal was worth nearly VND1.3 trillion.

The majority of shares have been re-bought by the Viet Nam Opportunity Fund (VOF) under the VinaCapital Group.

Diageo owns famous liquor brands such as Johnnie Walker, Smirnoff and Baileys while Halico is well-known for its brand of vodka. — VNS.

Viet Nam News

27 December 2011

Vilaf