Despite lengthy negotiations, South Korean credit card company Hyundai Card has failed to buy a 50 per cent stake in MSB's Finance Company Limited for Community (FCCOM).
In 2019, Hyundai Card, the credit card company of South Korean automaker Hyundai Motor, announced it would purchase 50 per cent stake in FCCOM – the consumer finance arm of MSB. However, the nearly $42 million deal has been called off.
According to the announcement, the firm would focus on sharing its knowhow of financial products, marketing, risk management, and digital finance, while MSB, which is familiar with the local market, would be in charge of sales and operations. The joint venture would have been Hyundai Card’s first overseas operation. The deal was to be completed in 2020.
FCCOM was acquired by MSB in 2015 and has been looking for potential foreign suitors since 2018.
“MSB signed a contract to sell 50 per cent of FCCOM to Hyundai Card. However, the major shareholders of Hyundai changed their business direction in Vietnam and Asia, so the deal was not completed due to the pandemic. The Hyundai side also provided partial compensation to MSB,” said Nguyen Hoang Linh, general director of the bank at the latest annual shareholders' meeting on March 24.
"MSB is now at the final phase of negotiation with another foreign partner. We hope that the upcoming divestment from FCCOM will bring a relatively large profit to MSB,” he added.
In 2020, FCCOM's profit reached was down 64 per cent on-year at only VND2.3 billion ($100,000).