South Korea's SK Group plays catch-up in Vietnam
Southeast Asian investment unit raises stake in drug firm Imexpharm
17 Jun 2021 | Nguyen Tuong Thuy

A unit of SK Group, South Korea's third-largest conglomerate, is raising its stake in Vietnam’s Imexpharm Pharmaceutical JSC as it plays catch-up with fellow chaebol Samsung and Hyundai in overseas expansion.

Singapore-based SK Investment Vina III has snapped up 3.4 million shares in the Vietnamese drug company for US$1.5 million, increasing its holding to 29.22% from 24.02%. The sellers are VOF Investment and Vietnam Ventures. Both are part of VinaCapital, a leading investment and asset management firm in the Southeast Asian nation.

Shortly after the transaction, the buyer, already a major shareholder in Imexpharm, registered to buy another one million shares to raise its ownership to 30.7%. The deal is set to go between June 18 and July 17 2021.

In 2018 the Korean conglomerate formed Singapore-based SK Southeast Asia Investment to focus on investing in startups and high-growth projects in the region, as well as managing the group’s current flagship businesses. It is part of SK Group’s efforts to keep up with Samsung and Hyundai in developing business overseas.

Two months after setting up the company, the group acquired a 9.5% stake in Vietnamese conglomerate Masan Group for US$470 million through the investment firm. In April 2019 it started investing up to US$1 billion into Vingroup, Vietnam’s biggest company by value. Like Vingroup, Masan is among the 10 biggest Vietnamese-listed firms by market cap.

The deals show that SK Group is focusing on the retail sector in Vietnam, where the population is approaching 100 million people.

This April the chaebol spent US$410 million buying a 16.3% stake in VinCommerce, the largest retail chain in the country. It acquired the shares from Masan Group, which has a controlling stake in VinCommerce.

VinCommerce used to belong to Vingroup but was sold to Masan in 2019. After that, Masan set up The CrownX as its integrated consumer retail platform by merging VinCommerce and Masan Consumer Holdings.

On May 18 2021, Masan said a consortium led by China’s Alibaba Group and Baring Private Equity Asia was investing US$400 million in The CrownX, an investment that will further fuel businesses under Lazada – Alibaba’s Southeast Asian e-commerce platform.

Meanwhile, E-mart, South Korea’s largest retailer, has sold its business in Vietnam to Thaco, one of the country’s biggest private conglomerates. The Vietnamese buyer, also a leading player in the local auto market, is operating E-mart Vietnam as a franchise and will pay royalties to E-mart.

The E-mart network in Vietnam has only one shopping mall, located in Ho Chi Minh City. Thaco expects to expand the system to 10 stores by 2025.

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