Newsletter
Vietnam M&A Spotlight - April 2020
Freshfields' Vietnam M&A Spotlight keeps you up-to-date with the key business and legal developments in this sector. Please contact us if you would also like to receive either our Vietnam Infrastructure Spotlight or our Vietnam Competition Law Spotlight.
MARKET UPDATES
General market
- M&A Lawyer. Bui Thanh Tien is the first ever Vietnamese lawyer elected to the international partnership of Freshfields.Tien is widely recognised as one of Vietnam’s leading corporate and finance lawyers. In his almost 20 years at Freshfields, he has acted on some of the most high-profile transactions in Viet Nam, often involving billions of dollars as well as complex and innovative deal structures. Source: Vietnam Investment Review
- EU – Vietnam FTA. The European Council approved the free trade agreement between the E.U. and Vietnam. This is the final step for the EU-Vietnam Free Trade Agreement to be effective. Vietnam’s National Assembly is expected to ratify the deal this summer, after which it would come into force. Source: Vnexpress International
- Pandemic speeds up M&A deals as companies become cheap. In the first quarter of the year, Viet Nam foreign investors acquired stakes worth US$2 billion in local companies. Source: Bizhub
FMCG
- Milk. Singaporean firm F&N Dairy Investment Pte Ltd has filed to purchase 17.4 million shares in domestic dairy giant Vinamilk. F&N Dairy Investments have repeatedly tried to increase its stake in Vinamilk in late 2019 and January 2020. Source: Vietnam News
- Food. Cooky is planning to develop Cooky Market, a food delivery service. The company will enter the delivery market to connect small family-owned farms, food stores and famous chefs with consumers. Foody was acquired by SEA Group for US$64 million in 2017, becoming one of the first start-up projects to be worth over US$100 million in Vietnam. Source: Bizhub
Banks
- Uncertain prospects. BIDV’s overvalued stocks will likely do more harm than good for the lender’s plans to lure funding in the face of pessimistic economic growth, despite its historic deal with South Korea’s KEB Hana bank. Last year, KEB Hana Bank completed the purchase of a 15 per cent stake in BIDV for VND 20.295 trillion (US$882 million). Source: Vietnam Investment Review
- Arm and leg. Saigon-Hanoi Commercial Joint Stock Bank (SHB) is planning to sell a part of its wholly-owned consumer finance arm SHB Finance to foreign strategic partners within 2020. Source: Bizhub
Insurance
- Life. FWD Group, the insurance arm of Hong Kong billionaire Richard Li’s investment group Pacific Century, announced that it has secured regulatory approval to proceed with the acquisition of Vietcombank-Cardif Life Insurance (VCLI), a 45:55 life insurance joint venture between Vietcombank and BNP Paribas Cardif. Source: DealStreetAsia
- Non-life. As Vietnam’s non-life insurance industry maintains a high growth rate and has plenty of room for development, the divestment in non-life insurance companies is expected to attract the attention of investors. PetroVietnam Insurance Corporation (PVI) andBao Minh Insurance are ready to divest in 2020. Source: Intellasia
Securities
- New Beginnings. Korean financial group JB Financial Group, through its subsidiary Kwangju Bank, completed its acquisition of 100% of the shares of Vietnamese securities company Morgan Stanley Gateway Securities JSC from Morgan Stanley and other shareholders. Source: The Investor
Industry
- High wire act. Stark Corporation PCL of Thailand has completed the purchase of 100 per cent equity in Thinh Phat Cables and Dong Viet Non-Ferrous & Plastic for US$240 million. The transaction was implemented by Stark Corporation’s subsidiary Phelps Dodge International, a leading Thai and Southeast Asian wire and cable manufacturer. Source: Intellasia
Aviation
- Vietnam Airlines to divest from Cambodia. Vietnam’s national flag carrier is divesting its 49 per cent stake in Cambodia Angkor Air and has also signed a contract to sell five aircraft. Earlier in 2020, the Prime Minister had approved a plan allowing Vietnam Airlines to restructure its investment in Cambodia Angkor Air. Source:VnExpress International
Renewable Energy
- Sunny skies. Thailand-based Super Energy Corporation will be picking up controlling stakes in four solar power assets with 750MW of capacity for US$457 million. The assets are under construction in Binh Phuoc. Super Energy calculated the return on investment rates from those four investment projects at around 17 per cent over a period of 20 years. Source: VnExpress International
- Becalmed. Filipino energy companyAboitiz Power Corporation has decided to terminate its planned acquisition of Mekong Wind from Armstrong Southeast Asia Clean Energy fund, due to a condition precedent being unmet by the agreed longstop date. Source: Vietnam Investment Review
Freshfields’ Q1 M&A Monitor / COVID-19’s impact on M&A
The firm has published our latest M&A Monitor for Q1 2020 in which we examine COVID-19’s impact on deal-making over the past three months. Alongside the pandemic’s effect on deal values and volumes, we examine some of its broader implications.
