Vietnam’s major conglomerate Masan on January 1 announced its takeover of 540 million shares or a 83.74% stake in VCM Services and Trading Development, Vingroup’s subsidiary in charge of retail business, said the former in a statement.
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VCM was established last August with registered capital of VND1 billion (US$43,121), in which Vingroup holds a 64.3% stake and Deputy General Director of Vingroup Mai Huong Noi served as VCM’s chairwoman, according to VnExpress.
By mid-September 2019, VCM raised its registered capital to VND6.43 trillion (US$277.19 million) and owned a 100% stake at Vingroup’s retail arm VinCommerce.
On December 3, Vietnam’s leading privately-run conglomerates Vingroup and Masan agreed to merge some of their businesses to create “the largest retail group in Vietnam”, said Vingroup.
As a result, Vingroup’s VinCommerce and its farming subsidiary VinEco would merge into Masan Consumer Holdings, the consumer business of Masan. The latter would take charge of the new company.
Vingroup would swap its stake in VinCommerce for that of the new company and become a stakeholder.
In the announcement on January 1, Masan also issued options to receive shares of the new company that is a subsidiary of Masan, and the new company will hold share contributions of and operate both VCM and Masan Consumer Holdings.
The agreement with Masan allows Vingroup to focus on its emerging businesses namely manufacturing and technology, while Masan obtains its last piece of a puzzle to build an empire of consumer retail, eventually penetrating international markets.
The new company would own VinCommerce’s network of 2,600 super markets and convenience stores of VinMart and VinMart+ across 50 provinces and cities in Vietnam, along with a customer base of millions.
After the takeover, Masan Consumer Holdings would continue to maintain the current management policies and benefits of VinCommerce and VinEco for the two latter’s employees, suppliers and customers, plus additional benefits from Masan.
The two side are finalizing details for official signing. This is considered the largest business deal in Vietnam last year.
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