Vietnam firm gets infusion from KKR
Vietnam firm gets infusion from KKR
KKR & Co. has agreed to invest $200 million in Vietnamese sauce maker Masan Consumer Corp., marking the largest investment to date in Vietnam by a private-equity firm.
U.S.-based KKR has been looking to back companies across Southeast Asia with exposure to the region's emerging affluent class and opened an office in Singapore last year to aid it in its search.
More than 90% of Vietnamese households own a Masan Consumer product, such as fish sauce, instant noodles or instant coffee. The company's sales have increased from $31 million in 2007 to approaching $500 million forecast for last year. Its third-quarter profit rose 50% to about $36 million from a year earlier.
KKR's $200 million investment is in addition to the $159 million it invested in Masan Consumer in April 2011.
The private-equity fund will have two seats on the company's board.
"Doubling our investment in less than two years demonstrates our strong conviction in Vietnam's growth story," said Ming Lu, KKR's Southeast Asia regional head.
Masan Consumer Chief Executive Truong Cong Thang said KKR's investment will help the Vietnamese company diversify into other fast-growing consumer-goods categories.
KKR's investment comes as Vietnam economy's grew last year at its slowest pace in 13 years, while a rising ratio of bad debt in the country has deterred banks from lending.
Despite the slowdown, Vietnam's Ministry of Planning and Investment said last week that it is targeting total foreign direct investment pledges of $13 billion to $14 billion this year, compared with $13.01 billion last year.
KKR's $200 million investment into Masan Consumer would be the largest private-equity investment in Vietnam on record, according to data provider Dealogic.
Other significant investments include the purchase by Japan's Mizuho Financial Group Inc. of a 15% stake in Vietcombank for $567 million in 2011.
Masan Consumer is part of one of Vietnam's largest private-sector conglomerates, Masan Group. Masan Group's shares are up about 30% since April 2011, when KKR first invested in Masan Consumer.
KKR has invested about $5.2 billion across the Asian-Pacific region, just under 20% of which has been plowed into Southeast Asia. So far, the firm has invested in four companies across Southeast Asia.
Acquisitions by private-equity firms have been growing across the Asian-Pacific region, climbing to $28 billion last year from $26 billion in 2011, according to Dealogic, recovering from a trough of $13.6 billion in 2009 in the wake of the global financial crisis.
KKR's investment in Masan Consumer will be one of the last investments by the private-equity firm's first pan-Asian fund, a person familiar with the matter said.
The firm is expected to finish raising a $6 billion fund for further Asian investments in coming months, people familiar with the situation said.
wall street journal
