Investors from South Korea are insisting on becoming strategic shareholders of Vietnamese enterprises, which is expected to help the latter improve their competitiveness significantly thanks to the first’s support of capital, technology and experiences.
SK Energy Co., Ltd wants to be PV Oil strategic investor
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It is notable that it took SK Energy a long time to pursue and become the major investor of PV Oil as it had to buy the Vietnamese firm’s shares in the stock market where only some 300,000 PV Oil shares were traded daily on average.
Earlier, in June, SK Energy lost a chance to become the PV Oil’s strategic shareholder due to PV Oil’s failure to complete the sale of shares to strategic investors within three months after its equitization plan as regulated by a government’s legal regulation.
Earlier in September, SK Group, parent company of SK Energy Co, also acquired 109.89 million treasury shares of Masan Group at US$470 million. The deal helped the South Korean company become the largest foreign shareholder in the Vietnamese firm with a 9.5 percent stake.
More Korean investment into Vietnamese firms is also forecast in the time to come. Another South Korean group in the construction industry, which is declined to be named, for example, is negotiating with one of Vietnam’s largest private construction companies, to become the strategic investor. Accordingly, the Korean group expected to buy shares of the Vietnamese firm in its private placement next few months at price higher than that listed on the stock market.
Win-win partnership
The investment inflow of Korean investors into Vietnamese firms is expected to help the latter enhance their competitiveness in the country’s rapidly international integration.
As in the case of Masan Group, commenting on the deal with SK Group, Danny Le, head of strategy and development at Masan Group, said: “We admire how SK Group has evolved into a diversified global powerhouse. Their invaluable experience, know-how, technology, business platforms and global network will provide Masan with a new dimension to deliver high-double digit growth for years to come.”
With SK Group’s support, Masan expects to grow its consumer wallet share by five times to US$100 per consumer per annum.
Meanwhile, Woncheol Park, representative director of SK South East Asia Investment, said that Vietnam is an important foundation for SK’s Southeast Asian strategy, adding that SK believes the partnership model is crucial to win in this region.
Lee Hyuk, former Ambassador of the Republic of Korea to Vietnam, said that there are already many companies in South Korea which are well-equipped with capital, state-of-the art technology, and strong management abilities that are paying special attention to Vietnam in their search for new markets.
Hyuk forecast that the Korean companies’ investments will grow both in quantity and quality in the years ahead, especially after the Korea-Vietnam Free Trade Agreements (KVFTA) is in full swing.
Sharing the same view, Hong Sun, vice chairman of the Korea Chamber of Business in Vietnam, said that Korean investments and exports to Vietnam have and will continue to grow because many Korean firms are seeking to invest and expand their business in order to meet conglomerates’ demands in Vietnam like Samsung, LG, and CJ Group.
