Masan

Masan holds 83.74% stake in Vingroup’s retail arm after merger

January 2, 2020 by hanoitimes.vn

Vingroup and Masan have agreed to merge some of their businesses to create “the country’s largest retail group”.

Vietnam’s major conglomerate Masan on January 1 announced its takeover of 540 million shares or a 83.74% stake in VCM Services and Trading Development, Vingroup’s subsidiary in charge of retail business, said the former in a statement.

Illustrative photo.

VCM was established last August with registered capital of VND1 billion (US$43,121), in which Vingroup holds a 64.3% stake and Deputy General Director of Vingroup Mai Huong Noi served as VCM’s chairwoman, according to VnExpress.

By mid-September 2019, VCM raised its registered capital to VND6.43 trillion (US$277.19 million) and owned a 100% stake at Vingroup’s retail arm VinCommerce.

On December 3, Vietnam’s leading privately-run conglomerates Vingroup and Masan agreed to merge some of their businesses to create “the largest retail group in Vietnam”, said Vingroup.

As a result, Vingroup’s VinCommerce and its farming subsidiary VinEco would merge into Masan Consumer Holdings, the consumer business of Masan. The latter would take charge of the new company.

Vingroup would swap its stake in VinCommerce for that of the new company and become a stakeholder.

In the announcement on January 1, Masan also issued options to receive shares of the new company that is a subsidiary of Masan, and the new company will hold share contributions of and operate both VCM and Masan Consumer Holdings.

The agreement with Masan allows Vingroup to focus on its emerging businesses namely manufacturing and technology, while Masan obtains its last piece of a puzzle to build an empire of consumer retail, eventually penetrating international markets.

The new company would own VinCommerce’s network of 2,600 super markets and convenience stores of VinMart and VinMart+ across 50 provinces and cities in Vietnam, along with a customer base of millions.

After the takeover, Masan Consumer Holdings would continue to maintain the current management policies and benefits of VinCommerce and VinEco for the two latter’s employees, suppliers and customers, plus additional benefits from Masan.

The two side are finalizing details for official signing. This is considered the largest business deal in Vietnam last year.

Vingroup, Masan make largest merger in Vietnam in 2019

December 3, 2019 by hanoitimes.vn

According to the agreement, Vingroup’s retail arm VinCommerce and its subsidiary VinEco would merge into Masan Consumer Holdings, the retail consumer business of Masan.

On December 3, Vietnam’s leading privately-run conglomerates Vingroup and Masan agreed to merge their some of their businesses to form the country’s largest retail group in Vietnam, said Vingroup in a statement.

Illustrative photo.

According to the agreement, Vingroup’s retail arm VinCommerce and its veggie subsidiary VinEco would merge into Masan Consumer Holdings, the consumer business of Masan. Masan would take charge of the new company.

Vingroup would swap its stake in VinCommerce for that of the new company and become a stakeholder. Details of the deal are not revealed.

The two side are finalizing details for official signing. This is considered the largest business deal in Vietnam this year.

Additionally, Masan is set to take over 14 hi-tech farms currently operated by VinEco.

“The merging would help Masan realize its target of becoming Vietnam’s top retailer and penetrate international markets,” said Truong Cong Thang, chairman of Masan Consumer Holding.

After the takeover, Masan Consumer Holding would continue to maintain the current management policies and benefits of VinCommerce and VinEco for the two latter’s employees, suppliers and customers, plus additional benefits from Masan.

In August, Vingroup transferred its entire shares at VinCommerce to VCM, its newly formed subsidiary, which was widely seen as a step in preparation for Masan’s acquisition of the arm.

In a letter to its employees, Vingoup’s executives said, after the deal, they would focus all resources for the industrial and technology sectors with two brands VinFast and VinSmart.

Masan Group Corporation, which is listed on the Ho Chi Minh City Stock Exchange, has a spate of subsidiaries include consumer goods producer Masan Consumer Holding, lender Techcombank, meat business Masan MEATLife, and mining arm Masan Resources.

A necessary step back: Masan chairman defends VinMart purchase

March 31, 2021 by e.vnexpress.net

The decision to purchase Vingroup’s subsidiary VinCommerce, which operates the VinMart grocery chain, had been met with opposition, even from investors who had trusted most in Masan, he said.

Quang acknowledged in the 2020 annual report released recently that investors had the right to be concerned as Masan acquired a loss of over $100 million via VinCommerce. The group also lacks first-hand experience in the retail business, he added.

However, the acquisition, announced January last year , is part of a plan to build a strong foundation for the future when modern retail companies will dominate and make substantial profits, he said.

The group has shut down over 700 underperforming VinMart+ stores and restructured the business with a focus on meeting customers’ demand, a move that helped VinCommerce break even at the end of last year.

Masan, which now operates over 2,300 VinMart outlets nationwide, is planning to build a retail ecosystem that can reach 30-50 million consumers in the next five years with a total of 30,000 stores.

Its retail business could earn revenues of $7-10 billion a year with double-digit profit growth attained by 2025.

The group’s final goal is to create a “one-stop shop” platform to meet all customers’ demand in finance, education, entertainment and healthcare, with both online and offline channels.

Masan, which also has interests in mining, food and meat production, is hoping to double its post-tax profits to VND2.5 trillion ($108.3 million) this year.

Masan chairman defends VinMart purchase

March 31, 2021 by e.vnexpress.net

The decision to purchase Vingroup’s subsidiary VinCommerce, which operates the VinMart grocery chain, had been met with opposition, even from investors who had trusted most in Masan, he said.

However, the acquisition, announced January last year , is part of a plan to build a strong foundation for the future when modern retail companies will dominate and make substantial profits, he said.

Masan, which now operates over 2,300 VinMart outlets nationwide, is planning to build a retail ecosystem that can reach 30-50 million consumers in the next five years with a total of 30,000 stores.

Its retail business could earn revenues of $7-10 billion a year with double-digit profit growth attained by 2025.

The group’s final goal is to create a “one-stop shop” platform to meet all customers’ demand in finance, education, entertainment and healthcare, with both online and offline channels.

Masan, which also has interests in mining, food and meat production, is hoping to double its post-tax profits to VND2.5 trillion ($108.3 million) this year.

Masan, Vinhomes raise VN-Index

March 31, 2021 by e.vnexpress.net

The index stayed in the green throughout the day, hitting the 1,190 range in the first hour of trading and closed with a five-point gain. This is its highest level in the last seven sessions.

Trading value on the Ho Chi Minh Stock Exchange (HoSE), on which the index is based, fell nearly 14 percent to VND14.6 trillion ($633 million). The bourse saw 222 tickers gain and 207 lose.

MSN of conglomerate Masan Group was the ticker that contributed most (1.25 points) to the VN-Index gain this session.

It rose 4.5 percent to the highest since Feb. 23. This is its third gaining session in a row.

VHM of real estate giant Vinhomes followed with a 0.88-point VN-Index contribution. The ticker rose 1 percent, its third session in the green.

SAB of beer producer Saigon Beer Corporation contributed 0.86 points, up 2.9 percent. The ticker has risen 4 percent in the past three sessions.

STB of Ho Chi Minh City-based lender Sacombank rose 4.6 percent to a new historic peak, its fifth gaining session in a row.

On the losing side, VJC of budget airline Vietjet led with a 1.4 percent drop, followed by REE of industrial appliance maker Refrigeration Electrical Engineering Corporation (REE), down 1.1 percent.

Foreigners were net sellers for the fourth session in a row to the tune of VND211 billion, with the strongest pressure on CTG of state-owned lender VietinBank and VNM of dairy giant Vinamilk.

The HNX-Index for stocks on the Hanoi Stock Exchange, home to mid and small caps, rose 1.97 percent, while the UPCoM-Index for the Unlisted Public Companies Market added 0.97 percent.

VinCommerce, realisation of Masan Group “Point of Life” business strategy

March 30, 2021 by www.vir.com.vn

Optimising the product portfolio, centring on fresh items, is one of the strategic measures helping to improve VinMart/VinMart+ operational efficiency

Despite facing the adverse impacts of COVID-19, in the fourth quarter last year VinCommerce for the first time posted VND16 billion ($695,650) in profit, with positive earnings before interest, taxes, depreciation and amortisation (EBITDA) of 0.2 per cent, signifying that this retail system has achieved its initial target of bringing VinCommerce to the breakeven point only one year after a landmark M&A deal with Vingroup, Vietnam’s top private conglomerate.

The move marks a watershed in Masan Group’s retail segment development, laying the groundwork for the company’s transformation in 2021.

Efforts to optimise product portfolio, centring on fresh items

On 8am everyday, Vu Thi Minh Ly, head of the fresh products division at VinMart Times City supermarket in Hanoi checks the wide assortment of products, from fresh meat and vegetables to breads fully covering the shelves after opening hour. Each day, Ly dedicates 90 per cent of her time to working directly at different spaces of the store, only spending 10 per cent of her time at work on paperwork.

More than a year after VinMart/VinMart+ fell into the hands of Masan, the fresh product segment at VinMart Times City has undergone remarkable changes.

“Compared to before, our fresh goods selection has been greatly diversified and comes in larger volumes, drawing very positive feedback from the customers. I check the areas under my control multiple times to ensure the products on the shelves are of the best quality. Despite greater product volumes, products must undergo strict quality control before reaching customers’ hands,” Ly said.

The stores have constantly come up with alluring sale promotion programmes targeting hundreds of daily essentials every day

Optimising the product portfolio, centring on fresh items, is one of the strategic measures helping to improve VinMart/VinMart+ operational efficiency that Masan has announced after acquiring the VinCommerce retail platform from Vingroup in late 2019. The shift has been deployed seamlessly across the VinMart and VinMart+ chains.

More than a year after VinMart/VinMart+ fell into the hands of Masan, the fresh product segment at VinMart Times City has undergone remarkable changes.

According to Nguyen Thi Ngoc Lan, VinMart+ regional manager, the product structure at VinMart+ has undergone notable changes with increased volumes. For instance, in the past there were about 30 kinds of products in the grocery space, mostly roots. It is now complemented with fresh vegetables and other fresh items like fish, chicken meat, and MEATDeli chilled pork. Many other quality products have been added to the store portfolio.

“Coming to VinMart+ now, customers can find almost all of their daily essentials,” said Lan.

Aside from diversifying their product portfolio with fresh items, attractive pricing programmes at VinMart/VinMart+ have also helped attract customers to the system. The VinMart/VinMart+ chains have constantly come up with alluring sale promotion programmes targeting hundreds of daily essentials every day. The discount policies are not only available during the weekend, there are also 15 day-a-month programmes.

Dual-way restructuring strategy

VinCommerce has been restructuring its operations in two directions: first, bolstering the operational efficiency of the whole system through optimising the product portfolio focusing on fresh items, aside from sale promotions or streamlining the operation model of VinMart+ with new shop arrangements.

Second, VinCommerce took drastic measures by closing supermarkets and poorly-performing convenience stores where revenue per square metre was nearly 50 per cent less than what would help them reach the break-even point. Hundreds of stores were closed last year. Simultaneously, VinCommerce has launched a raft of new stores with new arrangements in potential areas.

This strategy bore fruit, helping the leadership of Masan Group to quickly achieve VinCommerce’s breakeven goal after just one year, a goal which many initially deemed unattainable.

Fresh items are among the factors attracting customers to VinCommerce stores

After this first strategic milestone, VinCommerce’s target for 2021 is shifting from a traditional shopping venue to being an on-to-offline champion, ready to bring shoppers’ intriguing experiences.

Nguyen Dang Quang, chairman of Masan Group, calls this the “Point of Life”, signifying that the platform provides essential products and services representing more than 50 per cent of consumer spending, including fast-moving consumer goods (FMCG), fresh food, financial products and services, and value-added services. This is what Masan envisioned when breaking into the retail segment.

With the ambition to carve out a spot among the world’s top 50 retailers, Masan Group has established The CrownX by merging VinCommerce and Masan Consumer Holdings.

The merger is expected to create synergies to optimise Masan Group’s business efficiency. Accordingly, last year, The CrownX raked in a net revenue reaching VND54.277 trillion ($2.36 billion), growing into Vietnam’s second biggest retail performer.

By Tuan Khanh