Mobile World plans stake sale of $1.5 billion Vietnamese grocery unit

SINGAPORE/HANOI : Vietnam’s Mobile World Investment Corp said on Wednesday it has hired an adviser to explore the sale of up to 20 per cent of its Bach Hoa Xanh grocery chain in a deal sources familiar with the matter said would value the business at more than $1.5 billion.

“We have chosen an adviser and are working together closely to prepare needed documents for the deal,” a spokesperson for Mobile World Investment Corp told Reuters in an emailed statement.

“The deal is expected to complete by the first quarter of 2023,” the spokesperson said, declining to comment on valuation, citing confidentiality.

The sale is likely to attract interest from local and international retailers as well as financial investors, one of the sources told Reuters, declining to be name as the matter is confidential.

Mobile World Investment, co-founded and led by Vietnamese businessman Nguyen Duc Tai, joins a growing list of companies and funds trying to sell part of or all their consumer investments and businesses in Southeast Asia as the region’s economy rebounds from COVID-19 curbs.

Private equity firm CVC Capital Partner is in talks to exit top Indonesia snacks maker GarudaFood Putra Putri Jaya, while Restaurants Development Company is exploring the sale of its KFC franchise business in Thailand, Reuters has reported.

Mobile World Investment, which has a market value of $4.2 billion, has been revamping and automating the back-end activities of Bach Hoa Xanh to cut costs and boost profitability.

The company has also launched a recruitment drive to hire more than 3,000 employees at Bach Hoa Xanh, Mobile World Investment’s website shows.

Bach Hoa Xanh started in 2015 as a minimart chain specializing in selling fresh foods and daily basic needs, according to its website.

It now has more than 1,700 stores in Vietnam’s southern and south-central provinces and ranks among the top three biggest modern grocery retailers by revenue in the country, according to Mobile World Investment’s website.

Besides Bach Hoa Xanh, Mobile World Investment runs the biggest mobile phone retail chain in Vietnam by market share, The Gioi Di Dong, and the country’s biggest consumer electronics retail chain, Dien May Xanh, it says.

The group has a presence in Cambodia and Indonesia via its consumer electronics retail chain business, its website shows.

Its second quarter net income dropped 6.8 per cent year-on-year to 1.13 trillion Vietnamese dong ($48.15 million), while revenue rose 8.5 per cent, according to Refinitiv data. Shares in the group have risen 28 per cent over the past year.

($1 = 23,470.0000 dong)

(This story officially corrects lead to say Mobile World is selling up to 20 per cent of the business after the company clarified its earlier statement)

Source: Reuters