Vietnam: Investment funds group Dragon Capital purchases 15.3 mln shares of Sabeco

Dragon Capital, a Vietnam-focused group of investment funds, has purchased 15.3 million shares of Saigon Beer Alcohol and Beverage Corp (Sabeco) from Singapore-based Nogard Pte. Ltd, according to Vietnam Securities Depository (VSD), DEALSTREETASIA reported on March 16.

In its latest announcement, VSD said the shares were bought from Nogard by seven funds of Dragon Capital including Aquila SPC Ltd Hanoi Investments Holdings Limited, KB Vietnam Focus Balanced Fund, Norges Bank, DC Developing Markets Strategies Public Limited Company, Vietnam Enterprise Investments Limited (VEIL) and Viola Ltd.

The transaction’s value was not disclosed. However, based on Sabeco’s share price of VND214,000 ($9.4) per share on March 15, the transaction’s value is estimated at VND3.27 trillion ($143.8 million). Among seven funds, VEIL received the largest number of Sabeco shares with over 8 million shares.

Currently, the Ministry of Industry and Trade and Vietnam Beverage, a local unit in which ThaiBev holds a stake, own approximately 89.6 per cent stake of Vietnam’s largest brewer. The remaining is owned by Dragon Capital and some other investors.

According to data from Vietnam’s financial and economic portal Cafef.vn, Dragon Capital held 3.5 million Sabeco shares before the transaction. After the transaction, Dragon Capital holds a 2.9 per cent stake in the brewer.

Last December, Sabeco sold a nearly 54 per cent stake to Thai Beverage Pcl (ThaiBev) for $4.89 billion. ThaiBev, controlled by tycoon Charoen Sirivadhanabhakdi, through its local unit Vietnam Beverage, purchased 343.642 million Sabeco shares at the starting price of $14.05. The only other bidder, a Vietnamese individual, bought 20,000 shares, or 0.003 per cent, at a price of $14.07 each.

The Sabeco deal is said to allow ThaiBev to boost the chain of its investments in Vietnam. Through its Fraser and Neave Ltd. investment unit, it also holds a 16 per cent stake in Vinamilk, the country’s largest dairy firm and 49 per cent stake in a Vietnamese food and beverage company, the Vietnam F&B Alliance Investment Joint Stock Co.

Sabeco is Vietnam’s largest beer producer holding about 40 per cent share of the nation’s $6.5-billion beer market. Revenue from beer sales contributed 85 per cent to Sabeco’s total revenue and 95-97 per cent to its profit in 2014-2016.

Vo Thanh Ha, Chairman of Sabeco said the brewer targets raising its market share to 42 per cent, revenue to VND39.3 trillion ($1.72 billion) and after-tax profit to VND4.9 trillion ($215.6 million) in 2018, an increase of 11 per cent and 2 per cent respectively compared to 2017.

15 March, 2018