MEF II achieves 21.8x return on partial exit of MobileWorld shares

At a placement price of VND85,000 ($4) per share, and including dividends received, this is a 21.8x increase from the adjusted price per share at which the fund originally invested in MobileWorld in 2007.

With 62,737,745 shares in issuance, MobileWorld’s company value based on this transaction is VND5.332 trillion ($253.9 million). With a board approved net profit target of VND435 billion ($20.7 million) in 2014, this valuation represents a 2014(T) P/E ratio of 12.2x.

MobileWorld’s board of directors and meeting of shareholders have approved MobileWorld’s listing plans, with the goal of listing on the Ho Chi Minh City Stock Exchange in July 2014.

After this transaction, Mekong Enterprise Fund II continues to hold 14.3 per cent of MobileWorld’s shares.

The placement, managed by Viet Capital Securities Corp., was 2.5x oversubscribed and was allocated to six foreign institutional investors plus Vietnamese retail investors.

“MobileWorld’s board of directors and management team, under the leadership of the Chairman and CEO, Nguyen Duc Tai, have done an excellent job building MobileWorld into the leading mobile device retailer in Vietnam,” Chris Freund, Mekong Capital’s partner in charge of MobileWorld, said. “MobileWorld’s success is due to their open-mindedness about learning best practices from outside, their great ability to successfully implement those best practices in Vietnam, and their commitment to customer satisfaction. MobileWorld is a great example of what it looks like to build a robust management team and a strong corporate culture in Vietnam.”

MobileWorld is Vietnam’s leading mobile device retailer. The company’s TheGioiDiDong subsidiary has 220 mobile-device stores in all 63 provinces throughout Vietnam, with approximately 22 per cent market share in mobile phone sales. The company’s Dienmay subsidiary currently has 13 consumer electronics stores, concentrated in southern Vietnam and Ho Chi Minh City.

The thegioididong.com website received 424,000 daily visitors in March 2014, and is one of the leading B2C websites in Vietnam, leveraging the network of 220 stores to provide 30-minute delivery for online customers in many cities. MobileWorld was founded as a private company by five entrepreneurial co-founders, three of whom continue to serve as the group’s CEO, IT director and head of Inspection Committee.