FPT Corporation has sold six million shares or 30 per cent of its stake in FPT Digital Retail JSC to funds managed by and associated with Dragon Capital and VinaCapital.
(Photo: vietnambiz.vn)
Hanoi (VNA) – Information and communication technology group
FPT Corporation has sold six million shares or 30 percent of its stake in FPT
Digital Retail JSC to funds managed by and associated with Dragon Capital and
VinaCapital.
The deal completes the first stage of FPT’s plan to divest from its retail arm,
FPT Retail, reducing its ownership to 55 percent from the previous 85 percent.
The value of the deal was not revealed by either FPT or the two funds. FPT will
still keep control over its retail unit with a post-sale 55 percent stake, and
the income from the deal may not be recorded in the group’s third-quarter
earnings report.
In the second stage of the divestment plan, FPT could sell an additional 10
percent stake in FPT Retail to other investors via an initial public offering
(IPO), HCM City Securities (HSC) had said in a report in July. The second stage
is to be completed by the end of 2017.
At the group’s annual shareholder meeting held in April, FPT Chairman Truong
Gia Binh had said that selling the distribution and retail arm was a must so
that FPT could become a pure ICT group with rapid growth.
Andy Ho, chief investment officer of VinaCapital and managing director of the
Vietnam Opportunity Fund, was quoted in the FPT’s press release on Friday as
saying “This transaction enables us to make a meaningful investment in a
premier, unlisted company.”
“The consumer sector is one of our favourites,
and Vietnamese people have shown a huge appetite for mobile phones and
accessories, which is their primary tool to communicate and access the
Internet,” he said.
With a population of nearly 100 million people and annual retail revenues of 110 billion USD, Vietnam’s consumer market is among the most lucrative retail
markets worldwide and the retailing of mobile phones and technology gadgets has
posted impressive growth, said Vu Huu Dien, portfolio manager of Vietnam
Enterprise Investment Limited (VEIL) under Dragon Capital.
“FPT Retail, despite not being in the market for long, has demonstrated itself
as a leading retailer. We highly value the professionalism of the management at
FPT Retail, as well as FPT Corporation’s corporate governance and operation,
which serve as a firm foundation for FPT Retail’s future robust success in
Vietnam’s retail market,” Dien said.
FPT Retail is one of the leading retailers in Vietnam. It was operating 438
stores nationwide as of July 2017. In the first six months of 2017, it earned
nearly 6.2 trillion VND (275.5 million USD) in revenue, up 31 percent year on
year, and 141 billion VND in pre-tax profits, up 44 percent year on year.
For 2017, FPT Retail has set growth target of 27.5 percent and 40 percent in
revenue and pre-tax profits, respectively, by increasing sales in existing
stores and opening new ones in areas where smart phone penetration is low at
present. The company said e-commerce and an omni-channel approach will be used
to reach the business targets.-VNA