Arisaig Partner divests Vinamilk to invest in Sabeco and MWG
Arisaig Partner divests Vinamilk to invest in Sabeco and MWG
Arisaig Partner divorces Vinamilk after more than ten years in order to invest in Sabeco and Mobile World Investment Corporation (MWG).
Arisaig Partner has finalised its investment in Vinamilk and is turning towards Sabeco and Mobile World
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Member funds of Arisaig Partner, namely Arisaig Asia Consumer Fund and Arisaig Gem Consumer Fund, divested their investments in Vinamilk with a 20 per cent profit per year.
The report of Arisaig Partner showed that foreign groups are concerned about the growth of dairy shares. According to this fund, Vinamilk’s shares have ranked at the top position in the dairy sector during the past 10 years thanks to the school milk programme. However, the ticker's growth has been slowing down.
In addition, it saw the Vietnamese market reaching the saturation point sooner than expected, while simultaneously seeing more potential in the Chinese dairy market.
Arisaig Partner first invested in Vinamilk in 2002 via a direct auction and then sold this stake in 2009. After that – and following the financial crisis – it resumed its investment in Vinamilk. According to the annual report of Vinamilk, Arisaig Asia is the fifth-largest shareholder of the local dairy producer with the ownership of 28.8 million shares or 1.65 per cent. With the existing price of VND100,000 ($4.35) per share, the stake is valued at VND2.9 trillion ($126 million).
Arisaig Partner is divesting from Vinamilk to invest in MWG and Sabeco. Notably, since October 2019, it bought 17.3 million MWG shares. With VND80,000 ($3.48) apiece, this share volume is valued at VND1.4 trillion ($60.87 million).
MWG is a mobile phone and home appliance distributor, however, in recent years it penetrated the retail sector by opening the Bach Hoa Xanh chain. At present, Bach Hoa Xanh has the largest chain with 1,486 stores in MWG’s chain system. In addition, this chain reported an increase of 132 per cent in revenue in the first half of this year. MWG is paying attention to the clean agricultural sector via developing the 4KFarm model in the southern province of Dong Nai.
Regarding investment in Sabeco, in May Arisaig Asia bought an undisclosed share volume in Sabeco, the largest brewer in Vietnam.
Sabeco is facing difficulties due to the impact of the COVID-19 pandemic and Decree No.100, thus the company reported a 35 per cent plunge in revenue to VND12.04 trillion ($523.48 million) and 30 per cent in gross profit to VND1.86 trillion ($80.87 million).
Arisaig Asia Consumer Fund currently has $2.67 billion in assets, 3.1 per cent or $83 million of which come from the Vietnamese market.
