Alibaba and partner acquire 5.5% stake in Masan retail arm

A consortium led by Chinese-e-commerce giant Alibaba Group and Hong Kong-based Baring Private Equity Asia (BPEA) will acquire a 5.5% stake in The CrownX, Masan Group’s subsidiary for a total investment of US$400 million.

One of Masan's grocery chains in Vietnam. Photo: Masan Group

The deal implies a pre-investment valuation of US$6.9 billion for 100% of its equity, an equivalent of US$93.5 per share. Masan, the Vietnamese conglomerate, will own 80.2% of The CrownX when the deal is reached.

The CrownX is Masan’s integrated consumer retail arm that consolidates its interests in Masan Consumer Holdings (MCH) and VinCommerce (VCM).

As part of Alibaba’s investment, the Vietnamese retailer will partner with e-commerce platform Lazada to build its digital presence and capabilities, and accelerate the offline to online (O2O) market in Vietnam. 

“This strategic partnership will accelerate our ability to achieve the goal of transforming The CrownX into a one-stop-shop to serve consumers’ everyday needs, whether offline or online, “Point of Life”,” said Danny Le, CEO of Masan Group. 

Its immediate priority is to modernize Vietnam’s grocery market and develop an unparalleled consumer proposition from assortment to shopping experience, Danny said.

Janice Leow, Managing Director at BPEA expected this strategic investment has the potential to supercharge The CrownX’s growth in a nascent retail market and create the largest consumer ecosystem in Vietnam. 

In Vietnam, grocery accounts for 50% of the total retail market and 25% of the consumer wallet share. It is of essential daily use, but online penetration is still nascent. 

Masan expected the CrownX’s online Gross Merchandise Value to account for at least 5% of its total sales value in the upcoming years.

Masan is also in advanced discussions regarding a further strategic investment of US$300-400 million into The CrownX from other investors, expected to close in 2021.