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Vietnamese billionaires increasingly seek foreign capital resources

Vietnamese billionaires increasingly seek foreign capital resources

Saturday, December 09, 2023, 14:44 GMT+7
Vietnamese billionaires increasingly seek foreign capital resources
(From left) Tran Ba Duong, Pham Nhat Vuong, and Nguyen Dang Quang, billionaires of Vietnam

Several Vietnamese billionaires who own some of the country’s largest firms, including consumer goods producer Masan, EV maker VinFast, and auto firm THACO, have recently accessed foreign capital resources amid the economic downturn.

Masan Group, whose chairman is billionaire Nguyen Dang Quang, announced on Wednesday that Bain Capital, a leading U.S. private investment firm agreed to pour another US$50 million into the Vietnamese firm, raising Bain’s total investment in the enterprise to $250 million from the $200 million it announced in October.

Bain Capital will buy convertible dividend preference shares at VND85,000 ($3.50) each, which must be converted into Masan common shares on the 10th year at a ratio of one to one.

Michael H. Nguyen, deputy CEO of Masan Group, said that the firm expected to complete the transaction in the next several months.  

In January-September this year, Masan yielded net revenue of VND57.47 trillion ($2.4 billion) and an after-tax profit of over VND1.35 trillion ($55.4 million), plunging 66 percent year-on-year. 

The group said that it would seek further strategic capital sources, reduce costs, sell non-core assets, and weigh ceasing its channeling of capital into poor-performing business lines.

Meanwhile, the United States International Development Finance Corporation (DFC) has signed a letter of interest with EV maker VinFast, a subsidiary of Vietnam's largest conglomerate Vingroup, to consider the Vietnamese company's application for a $500 million loan for expansion.

The loan will be used to support VinFast's establishment of lithium-ion battery manufacturing facilities in Vietnam.

“DFC’s investment will be a powerful impetus for VinFast to go faster in its journey to expand globally and head toward a greener future,” said Le Thi Thu Thuy, global CEO of VinFast.

VinGroup chairman Pham Nhat Vuong recently completed the sale of international bonds worth $300 million, the first bond batch offered by a Vietnamese enterprise to the international market this year.  

The bonds, with an annual interest rate of 9.5-10 percent, can be converted into shares of Vinhomes, a property development unit under VinGroup, at VND51,600-53,900 ($2.1-2.2) each. The bonds are set to mature in 2028.

VinGroup earned over VND134.2 trillion ($5.5 billion) in net revenue in the January-September period this year, surging some 122 percent over the year-ago period, according to the group’s financial report.

Its after-tax profit inched down 0.9 percent to nearly VND1.56 trillion ($64 million) in the nine-month period.

Truong Hai Auto Corporation (THACO), owned by billionaire Tran Ba Duong, is not an outsider to the trend. It has mobilized VND8.68 trillion ($356 million) by selling bonds with an interest rate of 6 percent per year and a maturity date in 2028 in a private placement to Hong Kong-based Jardine Cycle & Carriage.

After the deal, Jardine Cycle & Carriage’s holding in THACO increased to 26.6 percent.

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Thanh Ha - Bong Mai / Tuoi Tre News

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