Foreign funds acquire larger presence

November 27, 2023 | 11:00
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Foreign investment funds are maintaining a keen interest in Vietnam’s consumer sector, underscoring its sustained allure for the booming consumer class.

Alibaba Group has acquired a minority stake in Vietnamese beauty retailer Hasaki, it was reported on November 18, marking the group’s strategic expansion in Southeast Asia.

Foreign funds acquire larger presence
The WinMart system under Masan will benefit from the latter’s financial strength

Backed by Hong Kong-based venture capital firm Excelsior Capital Asia, Hasaki has demonstrated both resilience and growth in a currently challenging economic environment.

Hiep Dinh, founder and CEO of Hasaki, said, “We are thrilled to welcome Alibaba International as a financial investor. Despite the challenging macroeconomic conditions, this transaction is a testament to Hasaki’s business model and capability.”

Hasaki, which has been operational since 2016 with over 140 stores and a dynamic online presence, commands a significant market presence with 3.8 million members and 750,000 monthly consumers.

Targeting around a 35 per cent domestic market share by 2027, Hasaki wants to capitalise on Vietnam’s burgeoning $2.2 billion beauty sector, which is rapidly modernising.

This investment follows AIDC, a unit of Alibaba Group, spinning off in March this year. AIDC is overseeing and other international ventures, reporting a 53 per cent revenue jump to $3.36 billion in Q3/2023.

Alibaba’s strategy focuses on lucrative international markets, with this acquisition complementing its previous investment in Masan Group’s The CrownX in Vietnam.

In 2021, along with BPEA EQT, it led an investor group to acquire a 5.5 per cent stake in The CrownX complex, totalling $400 million.

Meanwhile, private investment firm Bain Capital in October agreed to invest at least $200 million into Masan Group in equity capital at a price of VND85,000 ($3.50) per share.

“Proceeds from the transaction will be used to strengthen Masan’s financial position and de-lever its balance sheet. This marks Bain Capital’s first-ever investment in Vietnam and underscores its confidence in Masan’s ability to realise the immense opportunity to fulfill 100 million Vietnamese consumers’ daily grocery, financial, and other life needs,” Masan said.

According to Bain Capital, Vietnam stands as Southeast Asia’s leader in consumption growth, projected at an annual rate of 7.7 per cent from 2022 to 2040.

This surge is fuelled by rapid urbanisation and the emergence of a booming consumer class, characterised by rising disposable incomes and shifting demands that span from fundamental necessities to lifestyle and financial products, it said.

A fortnight ago, Japan’s Sojitz Corporation announced that it, together with Sojitz Asia Pte., Ltd. and Sojitz Vietnam Co., Ltd., has jointly acquired full ownership of New Viet Dairy, Vietnam’s largest wholesaler of commercial food (see Page 8).

Sojitz believes that Vietnam’s dairy market is poised to reach $8.4 billion, growing annually by over 8 per cent.

Masataka “Sam” Yoshida, head of the Cross-border Division of RECOF Corporation said, “Key sectors drawing investor interest for M&A opportunities in Vietnam include fast-moving consumer goods, retail, food manufacturing and processing, logistics, and also financial services.”

He added, “Particularly, the logistics sector has become a major area of focus for investors, alongside the cold storage supply chain, which is also attracting considerable attention in Vietnam in particular.”

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By Trung Duong

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