In accordance with the terms of the agreement, Warburg Pincus acquires a 20% equity interest in Vincom Retail and in addition provides that Warburg Pincus has a commitment to participate in additional future capital raising by Vingroup in an amount of up to US$25 million.
Provisions of the agreement further provide that the Warburg Pincus consortium will invest an additional US$100 million in Vincom Retail to expand the platform and explore future retail property-related opportunities.
Vincom Retail is valued at approximately US$1.1 billion and is the largest owner and operator of shopping malls in Vietnam. It owns and operates seven properties, which include the finest in world class shopping, recreational and dining facilities.
This transaction marks the first investment by Warburg Pincus in Vietnam, and it is the largest initial investment to date in a Vietnamese company by a global private equity firm.
This investment by the Warburg Pincus consortium is the latest success for Vingroup in raising funds from global capital markets and follows on from Vingroup's US$300 million convertible bond issuance to international investors in 2012.
Vincom Centre B Ho Chi Minh City
TThis strategic co-operation is founded on a common vision for developing the retail operations of Vincom so as to benefit both parties from one of the world’s fastest growing domestic retail sectors and bodesfavourablythe long-term economic outlook in Vietnam and on the rapid development of an urbanized middle class.
The partnership brings together Vincom Retail's market-leading position in Vietnam's most important urban centers and Warburg Pincus' global retail and consumer industry expertise.
Le Thi Thu Thuy, Vingroup's Vice Chairwoman cum CEO, said: “The combination of this injection of capital and Warburg Pincus’ strong track record in investing in and supporting the growth of global retail and consumer businesses will enable us to accelerate the rollout of our planned shopping mall developments.
Vincom Retail is a subsidiary of Vingroup that owns seven assets and, upon completion of the transaction, will be valued at approximately US$1.1 billion. Vincom Retail is Vietnam’s largest owner and operator of shopping malls.
Its existing assets include Vincom Center B in Ho Chi Minh City and Vincom Center Ba Trieu in Hanoi, which properties have attracted both top tier global brands as well as midmarket retailers, and are targeted to tap into the most lucrative segments of Vietnam’s fast growing consumer market.
Vincom Retail also has a number of projects under development, including Vincom Mega Mall Royal City and Vincom Mega Mall Times City, which are both due to launch later in 2013.
