According to IMAA (Institute for Mergers, Acquisitions and Alliances), some M&A deals are nearly about to get completed and if all of them go smoothly as planned, the total value would be $5.3 billion for the whole year 2016, equivalent to the M&A value in 2015.

The total number of M&A deals in 2016 is considerably higher than the year before with 611 deals reported. The figure showed a 15 percent increase in comparison with 2015, which could be a surprise to many analysts because the world saw a downward trend in 2016.

However, analysts pointed out that the value of M&A deals in Vietnam is modest with just $8-9 million for each. The figure was suitable to investment strategies being followed by most of the investment funds in Vietnam such as Mekong Capital and VinaCapital.

By early December 2016, the total value of the merger and acquisition (M&A) deals in Vietnam had reached $5.1 billion.

2016 was ac discouraging year in terms of the equitization of state-owned enterprises as the process went slowly. 

According to IMAA, industries, materials and consumer goods are fields which witnessed the highest numbers of M&A deals in 2016. Meanwhile, the real estate sector is leading in terms of value.

The biggest M&A deals include the ones where Thai Central Group took over Big C Vietnam in a $1.14 billion affair. In the real estate market, investors from Japan, South Korea and Singapore carried out a series of transfer deals worth millions of dollars. 

Keppel Land, for example, bought 40 percent of stakes in the joint venture to develop Empire City at $95 million. Meanwhile, CapitaLand spent $52 million to buy VRG River View from the Vietnam Rubber Group.

Vietnamese real estate developers such as Novaland, Van Thinh Phat and Hung Thinh also accept to spend big money to buy potential unfinished projects to expand their business scale.

The M&A deals in the hotel and resort tourism market segments caught the attention from the public. VinaCapital transferred 50 percent of Metropople Hotel’s stakes to a group of new investors. Pan Pacific bought Sofitel Plaza Hanoi, while Mapletree took over Kumho Asiana in the central district 1 in HCMC.

According to JLL Vietnam, a real estate consultancy firm, the factors that pushed up M&A activities were the positive prospects of the economy, the 70 percent of population at the ages of 15-64 who have increased usable incomes, and rapid urbanization.

Foreign investors, to take full advantage of FTAs, have rushed to acquire many Vietnamese companies to expand their business in Vietnam. Taisho Pharmaceutical spent $100 million to buy 24.4 percent of Hau Giang Pharmacy, while JX Nippon Oil & Energy bought an 8 percent stake in Petrolimex.

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Thanh Mai