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KKR invests $250 million in Masan

Released at: 20:57, 03/04/2017

KKR invests $250 million in Masan

Deal includes $150 million purchase of shares in Masan Nutri-Science and $100 million in Masan Group shares.

by Quynh Nguyen

Leading global investment firm KKR has finished a $250 million investment agreement with the Masan Group Corporation and its branded meat platform, Masan Nutri-Science.

Under the agreement, KKR will invest $150 million to acquire 7.5 per cent of shares in Masan Nutri-Science and $100 million to purchase shares of the Masan Group owned by PENM Partners, an independent Danish private equity company.

This is the second investment KKR has made in Masan, after its $359 million investment in Masan Consumer Corporation. 

Chairman of the Masan Group, Mr. Nguyen Dang Quang, said that KKR’s investment will help the group strength its financial platform in order to implement commitments with consumers.

Mr. Ashish Shastry, KKR’s Head of Southeast Asia, said the investment underscores KKR’s commitment to Vietnam in particular and to ASEAN generally. “Vietnam holds great opportunities with its growing economy and favorable demographic trends,” he said. “KKR is committed to investing in the market by partnering with leading companies such as Masan Nutri-Science.”

Last year, Masan outbid South Korean conglomerate CJ to acquire a 14 per cent stake in the State-controlled meat processor Vissan. The group’s animal feed subsidiary Anco bought 11.3 million shares of Vissan for more than VND1.43 trillion ($63.1 million), or VND126,000 ($5.6) per share, compared to CJ Vina’s bidding price of VND120,600 ($5.3) per share. 

Vietnam’s meat market is currently valued at $18 billion, with consumption of 33.5 kilograms per head per year, which is expected to reach 39 kilograms by 2020.

Masan’s financial report showed that its revenue in 2016 stood at VND43.2 trillion ($1.9 billion), up 41.4 per cent year-on-year, with a pre-tax profit of VND9.6 trillion ($442.2 million). 

Food and beverages (F&B) brought the largest revenue to the group in 2016, with VND39.2 trillion ($1.7 billion), or 40.3 per cent. Profit from F&B reached VND6.2 trillion ($272.8 million), up 30 per cent year-on-year. Revenue from minerals and other fields, meanwhile, reached VND4 trillion ($176 million). 

The merger of Saigon NutriFood and the acquisition of 25 per cent of shares in Vissan helped Masan complete its model of Feed - Farm - Food (3F). The 3F model has contributed over 50 per cent of the group’s revenue and profit over the last few years.

The group has targeted growth of 15 to 20 per cent this year, of which F&B and consumer products will contribute 90 per cent of net revenue.

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