Mekong Capital divests from Masan Food

November 09, 2010 | 17:59

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Mekong Capital today announced that its Vietnam Azalea Fund Limited (“VAF”) had made the first divestment from Masan Food Corporation for this year, 18 months after investing in and gaining the doubling profit.

The $100 million VAF entered into an agreement to divest its full investment in Masan Food Corporation (“Masan Food”) in a negotiated OTC market transaction at a total consideration of $18.84 million from its investment value of $9.4 million from May last year.

This transaction resulted in a gross return multiple of 2x and a gross internal return ratio (IRR) of approximately 61 per cent on the shares sold by the fund.

“Masan Food is one of the best managed consumer goods companies in Vietnam today. The company’s ability to early identify new consumer trends and successfully launch new products into this fast growing market is impressive and has created significant shareholder value,” said Thomas Lanyi, director of Investment of Mekong Capital.

VAF acquired a minority stake in Nam Long Investment Corporation (“Nam Long”) for approximately $9.1 million last June.

Masan Food has grown from around $23 million in net profit in 2008 to an expected net profit of around $55 million in 2010, a net profit growth rate of around 55 per cent per year.

The 61 per cent of IRR achieved by the VAF on this investment is closely linked to the net profit growth achieved over the period of the Fund’s investment.

Masan Food recently ventured into the branded instant noodle segment for the domestic market and held close to 20 per cent market share by September, 2010.

Masan Food’s core products include fish sauce, soy sauce, instant noodles, gravy granules and chili sauce under well-recognised brands such as Chin-Su, Tam Thai Tu, Nam Ngu, Omachi, Oh Ngon! and Tien Vua.

By Van Anh

vir.com.vn

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