Mekong Capital fully exits investments in three private equity funds

Mekong Capital is the first equity fund to successfully exit three funds in Southeast Asia

Most recently, Mekong Enterprise Fund (MEF), a fund run by Vietnam-focused private equity firm Mekong Capital, has divested its final remaining investment in Minh Hoang Garment JSC.

The deal came after the divestment of Mekong Capital’s stake in Asia Chemicals last month and the liquidation of Vietnam Azalea Fund last year.

“With the exit from Minh Hoang, we are delighted to have completed the divestments of all of our first three funds. This enables us to focus on our newer investments in Mekong Enterprise Fund III, partnering closely with each company to ensure they each achieve their vision,” said Mekong Capital founder and partner Chris Freund.

Minh Hoang is a local producer of sports apparel, active-wear, and outerwear. Overall, Mekong Capital's funds have completed 33 private equity investments in Vietnam, 26 of which have been fully exited, getting substantial profit for Mekong Capital as well as its funds.

Notably, MEF II completed the sale of its last remaining five million shares in Mobile World Group in January 2018, resulting in 56.9x of gross return multiple and 61.1 per cent gross IRR, making this investment one of the most successful investments in the history of Asian private equity. Prior to that, the fund generated a gross return of 4.5x and 9.0 times for its investments in Vietnam Australia International School and Golden Gate, respectively.

A number of exits under Vietnam Azalea Fund were investments in privatised state-owned companies.

The fund manager has a value creation platform called Vision Driven Investing with the aim to generate at least a gross return of 5x for each investment, and is intensively applying it to all portfolio companies in its active Mekong Enterprise Fund III (MEF III).

Its latest investment vehicle, MEF III announced investments in seven companies, including lending firm F88, logistics companies Nhat Tin and ABA, restaurant operator Red Wok, Ben Thanh Jewelry, Yola Education, and mattress retailer Vua Nem.

With the divestment from the first three funds, Mekong Capital plans to raise its Mekong Enterprise Fund IV in the first half of 2019.