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Vingroup teams up with Masan Consumer Holding

Released at: 10:46, 04/12/2019

Vingroup teams up with Masan Consumer Holding

Photo: Viet Tuan

Vingroup enters into share swap agreement to merge its retail and agriculture units with Masan Consumer Holding.

by Ngoc Lan

Vietnamese behemoth Vingroup has entered into a share swap agreement to merge its retail and agriculture units with Masan Consumer Holding, part of the Masan Group, to form the country’s largest consumer platform.

The agreement aims to optimize the strength of each party’s activities and at the same time create a new Consumer Goods - Retail Group with outstanding competitiveness and leading scale in Vietnam. The two sides are now carrying out the necessary legal procedures to sign an official contract.

Vingroup’s retail unit VinCommerce and agriculture unit VinEco will be merged into the Masan Group. Vingroup will swap all shares in VinCommerce into shares of the new company after the merger. Masan will take control of operations while Vingroup will be a shareholder.

The new company, which aims to be the country’s leading consumer and retail corporation, will have a network of more than 2,600 supermarkets, a chain of VinMart and VinMart + stores in 50 cities and provinces with millions of customers, along with 14 high-tech farms of VinEco.

Mr. Truong Cong Thang, Chairman of Masan Consumer Holding, said Vingroup has completed its mission of creating the leading clean agriculture and retail system in Vietnam. “We will now continue our mission to serve consumers, ensuring a fair playing field for Vietnamese manufacturers,” he added. “The joining of VinCommerce and VinEco not only resonates value for Masan’s core competencies but also helps us quickly achieve our goal of becoming the leading domestic Consumer Goods - Retail Group in the country, aiming to reach out to the world.”

Since its inception, VinCommerce has continued to expand its presence by increasing the number of stores as well as the acquisition of supermarkets and convenience stores. The company completed the acquisition of the entire Fivimart chain of 23 supermarkets from the Nhat Nam JSC. In April this year, VinMart also acquired a chain of 87 Shop & Go-branded convenient stores. Most recently, it acquired local supermarket chain Queenland Mart as a continuing step to expand its retail market share.

In September, Singapore’s sovereign wealth fund GIC led a consortium in investing $500 million in Vingroup’s retail business the VCM Services and Trading Development JSC, which was recently established to oversee its operations of supermarket and convenience store chains.

Masan Consumer is one of Vietnam’s largest local diversified fast-moving consumer goods (FMCG) companies. It manufactures and distributes a range of food and beverage products, including soya sauce, fish sauce, chili sauce, instant noodles, instant coffee, instant cereal, and bottled beverages.

In addition to GIC, South Korea’s SK Group last year also invested $470 million in Masan in a deal that made it the largest shareholder in the company, with a 9.5 per cent stake. SK is also a shareholder in Vingroup, with a 6.1 per cent stake, following a $1 billion investment in May.

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