The Vietnamese car maker Thaco has reached a deal with South Korea’s Emart to purchase 100% stake in its business in Vietnam and will operate it under franchise.
|Emart in Go Vap district, HCMC. Photo: Emart Vietnam|
The deal will be completed this week, according to Thaco’s representative.
Emart, owned by the South Korean retail giant Shinsegae, also disclosed the information in the Korea Times, citing the repeated obstacles to expanding its operations in Vietnam as the reason. As the deal takes effect, the South Korea's largest retailer will receive royalty payments from the Vietnamese buyer instead of directly operating the business.
The retail giant entered the Vietnamese market in December 2015 and opened its first discount store in Go Vap district, Ho Chi Minh City. It planned to open the second store in Hanoi but failed due to licensing issues.
The hypermarket chain also planned to open 50 stores in Vietnam by 2023.
Thaco, Vietnam's car assembler, is operating in the fields of automobiles, real estate, and agriculture, and owns a number of business sites and shopping malls.
Emart expects Thaco, which is engaged in the real estate business and runs several shopping malls, will open over 10 discount stores in its second major Asian market by 2025. Emart-branded products and a number of made-in-Korea items will be sold at the stores.
Vietnam’s total retail sales are forecast to reach nearly $350 billion by 2025. It is believed to have the potential for domestic and foreign investors.