MAF’s research team, in its latest report, pointed out that the merger and acquisition (M&A) in 2015-2016 will still focus on consumer goods, finance & banking, real estate and retail. However, the investors from Thailand will be the major buyers.Thai investors have many reasons to come to Vietnam. It is not only a large market with increasingly high demands, but also serves as a ‘jumping board’ for them to access neighboring markets.
In the retail sector, Central Group in early 2015 spent US$100 million for a 49% stake of Nguyen Kim, a home appliance distribution network, and announced a plan to turn the network into the leading distribution chain of its kind in South East Asia.
Central Group plans to open 50 Nguyen Kim shops by 2019, twice as many as the existing number of shops. Prior to that, Central Group established Robins, a high end retail chain in Vietnam.
Meanwhile, Berli Jucker stirred up the public with the announcement about taking over Metro Cash & Carry Vietnam at US$879 million. Prior to that, BJC bought Family Mart and 65% of Vietnamese Phu Thai Group.
Commenting about Thai investment strategy, a branding expert said Thais have been following a professional investment strategy based on their knowledge about local culture and habits.
The investors have drawn up clear roadmaps for penetrating the Vietnamese market: they know well when and what they should do to acquire Vietnamese businesses – an important move in their plan to conquer the Vietnamese market.
The branding expert also noted that the Thai capital flow to Vietnam comprises capital from billionaires with Chinese origin. Charoen Sirivadhanabhakdi, the owner of ThaiBev, BJC and TCC Holdings, and Dhanin Chearavanont, chair of CP Group, are of Guang Dong origin. Meanwhile, the Chirathivat family which owns Central Group, is of Hainan origin.
Thai investors are mostly targeting most important and potential business fields in Vietnam.
The retail sector, for example, is predicted to have annual growth rate of 15% with total revenue of US$97 billion by 2016, according to Economist Intelligence Unit. Meanwhile, CP Vietnam has been succeeding in the animal feed market worth US$6 billion a year, and the animal meat market worth US$18 billion.
Thai investors, who have powerful financial capability, tend to take shortcuts to Vietnam by acquiring Vietnamese leading enterprises. SCG, after buying Prime Group, now controls Vietnam’s building material industry with 20% market share.
The investments in two Vietnamese leading plastics manufacturers – Binh Minh and Tien Phong Plastics – promises to help SCG cement its position in the industry.
