Novaland is in the process of negotiating to sell a residential project in Ho Chi Minh City which will bring about approximately VND40 trillion ($1.74 billion) within this year, with disbursement slated for 2022.
|A residential project developed by Novaland |
Novaland refused to release further details, but VIR was told that two domestic companies were involved in this big transaction deal.
This project is expected to bring a profit of around VND8 trillion ($347.83 million) to pump additional finance into three 1,000-hectare projects which are underway at the same time, namely NovaWorld Phan Thiet (Binh Thuan), NovaWorld Ho Tram (Ba Ria-Vung Tau), and Aqua City (Dong Nai).
According to its annual report for 2020, Novaland has a land fund of about 700ha in Ho Chi Minh City. More than 100ha of this land are concentrated in the east of the city, and are eligible for developing large-scale urban development projects.
This is not the first large-scale project done by Novaland through a mergers and acquisitions (M&A) process.
At the recent 2021 annual general shareholders' meeting, Bui Xuan Huy, general director of Novaland revealed that as of the first quarter of 2021, the group recorded a land fund of more than 5,400ha with the total gross development value estimated at nearly $45 billion.
Looking back on the development of Novaland, from the first project Sunrise City in District 7, Ho Chi Minh City developed in 2008, this group has acquired and developed dozens of projects through M&A across Ho Chi Minh City and many other cities and provinces, including projects with scale of thousands of hectares.
Novaland has set up its target to widen its land fund via M&A for many years. From 2008 to 2017, Novaland focused on residential projects in Ho Chi Minh City only. Sicne 2018, the group has been expanding its business to urban development areas in satellite cities and tourism complexes in coastal tourism destinations.
The company aims to increase its land funds to 10,000ha by 2030 in the south-central region.