MWG to sell 20 per cent stake in grocery chain Bach Hoa Xanh

August 26, 2022 | 09:42

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Vietnam’s major retail Mobile World Group (MWG) is reportedly considering a 20 per cent stake sale in its Bach Hoa Xanh grocery chain.

MWG to sell 20 per cent stake in grocery chain Bach Hoa Xanh

The deal, if successful, could value Bach Hoa Xanh at least $1.5 billion.

According to Reuters, MWG has picked an advisor and the two sides are proactively working together to prepare for the transaction.

A representative of MWG also revealed that the transaction is anticipated to be finalised within the first three months of 2023.

MWG, with a current market capitalisation of around $4.2 billion, is boosting the back-end activities of Bach Hoa Xanh in order to enhance efficiency and profitability.

In the first seven months of 2018, MWG made a bold commitment to overhaul Bach Hoa Xanh by closing around 400 outlets throughout the network.

"It is true that we closed several hundred points of sales in Bach Hoa Xanh's system. But the total revenue is continuing to climb," said MWG's chairman Nguyen Duc Tai in a recent investor meeting.

He also stated that the chain would begin to generate profit during the fourth quarter of this year.

"This is a landmark progression for Bach Hoa Xanh. The financial contributions made possible by Bach Hoa Xanh will be significant to the growth of MWG as a whole," he stressed.

In addition to Bach Hoa Xanh, MWG also runs The Gioi Di Dong, Vietnam's biggest mobile phone retail chain by market share, and Dien May Xanh, the country’s largest electronics retail chain.

The Gioi Di Dong and Dien May Xanh accounted for around 80 per cent of MWG's total income in the first seven months of 2022. The Apple shop Topzone and Dien May Xanh Supermini, an electronics retailer in rural areas, are the new growth catalysts for these two businesses.

MWG also has a foothold in the consumer electronics retail sector in both Cambodia and Indonesia.

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