E-Mart to spread its roots

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>> E-mart ready to play the retail game

Is going into a joint venture with E-Mart a way to help U&I materialise its investment plans since banks’ credit tightening policies do not support the firm’s ambitious development targets?

E-Mart accounts for 35 per cent of the retail market share in South Korea and boasts of its time-honoured history operating in modern retail services dating back in the 1930s. To South Korean consumers E-Mart is one of the best retailers of fresh food.

U&I owns an extensive 500 hectare hi-tech agricultural farm up to global good agricultural practice standards. Through shaking hands with E-mart, we will bring Unifarm’s products as well products of Vietnamese farmers into E-Mart store chain not only in Vietnam but in other countries where E-Mark set a foothold in. That is our expectation.

Besides, we want to make use of E-Mart’s knowledge, technology, experience and financial capacity to spur Vietnam’s retail sector development, including logistics since one our subsidiary, U&I Logistics, is part of the national logistic development strategy that is now in the making.

U&I held a modest share of 20 per cent in the joint venture with E-Mart. Do you think that is a low rate?

E-Mart can form a wholly owned joint venture in Vietnam like the way another retailer from Europe was doing. For us, we need to weigh up our potential and the 20 per cent share is not small.

Assuming that the E-Mart bought out the remaining 20 per cent of U&I share in the joint venture, will that benefit U&I?

We have carefully considered the possibility to hold that 20 per cent share even in case E-Mart investment in Vietnam scales up to $1 billion. However, we care about the capital usage efficiency and the joint venture’s future development prospects.

E-Mart’s top leadership and I have known each other for a long time before decided on forming the joint venture in Vietnam. To us, this is a long-term deal that is socially beneficial so we respect both sides’ contributions.

Vietnam’s retail market segment is now less attractive in the eyes of foreign players, so E-Mart’s decision to jump into Vietnam at this point of time is good for local farmers since they will have their products appear worldwide through the E-Mart system.