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Banking & Finance

SSI & Daiwa open new PE fund

Released at: 09:04, 14/09/2016

SSI & Daiwa open new PE fund

Photo: Duc Anh

$40 million private equity fund to concentrate on investments in manufacturing, services, FMCG, agriculture, and seafood.

by Hung Nguyen

The DAIWA-SSIAM Vietnam Growth Fund II L.P (Daiwa-SSIAM II), a new private equity fund with committed capital of some $39.4 million, has been formed by two asset management companies from Vietnam and Japan.

The fund's manager, SSI Asset Management (SSIAM), is a fully-owned subsidiary of Saigon Securities Inc. (SSI) and the Daiwa Corporate Investment Co. Ltd (Daiwa).

“The calling for investment stage has ended, with total committed capital of $39.4 million attracted,” according to an SSI press release on September 12.

The new fund’s investment focus is on particular sectors such as manufacturing, services, fast-moving consumer goods (FMCG), agriculture, and seafood, which benefit from Vietnam’s young population structure, rising middle class, and deeper international integration.

The fund may also invest in State-owned enterprises (SOEs) as they divest.

It has an eight-year life span.

Daiwa-SSIAM II will take 10-30 per cent ownership and seats on the Board of Management at investee organizations.   

The new fund is open-based and has been launched at a time when Vietnam’s economic situation is positive. “Vietnam’s economy is maintaining its growth, FDI is increasing, interest rates and exchange rates are stable, inflation is being well managed, foreign reserves are sufficient, and consumption demand and living standards are rising over time,” according to SSI.

SSIAM believes Vietnam’s business situation is improving. “Vietnam’s businesses still have huge space to develop in both domestic and export market thanks to free trade agreements such as the TPP,” SSIAM’s analyst said.   

Daiwa-SSIAM II is the second private equity fund to be opened by the two asset management companies.   

In October 2009 the DSCAP-SSIAM Vietnam Growth Investment Fund LLC was created, with full divestment completed last year.

In the first half of 2016 the State Securities Commission (SSI) licensed one member-owned fund, one closed-end fund, and one open-ended fund. Vietnam now has 29 operating funds, of which 21 are equity funds (18 open-ended funds, two exchange-traded funds (ETF), and one closed-ended fund), and eight member-owned funds.  

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