|
M&A deals thrive despite market slump
While the stock market has been in a sustained slump, merger and acquisition deals continue on the rise.
Late last month, Germany's ERGO Insurance Group acquired a 25-per-cent stake, or 10 million shares, in the Vietnamese non-life insurer Global Insurance Company, forming a strategic partnership.
The deal was worth VND380 billion (US$18.1 million) and attracted substantial media attention at a time when other insurers were having difficulties in selling stakes or increase their charter capital as requested by the Ministry of Finance.
Also at the end of February, the Viet Nam Post Corporation invested in the Lien Viet Bank by using charter capital from it subsidiary Viet Nam Postal Savings Service Company, valued at VND163 billion ($7.8 million).
After the deal, the bank changed its name to Lien Viet Post Commercial Bank and its charter capital is expected to increase to VND5 trillion ($238.1 million).
Other significant deals include leading distiller Diageo's purchase of a 23.6-per-cent stake in the Ha Noi Liquor Joint Stock Company (Halico). The deal, worth $51.6 million and to be complete by the end of June, is expected to boost Diageo's presence in Viet Nam's growing drinks market.
Analysts said the trend of both foreign and domestic institutional investors buying into profitable enterprises would continue this year, as these investments would allow new partners to get involved in companies' corporate restructuring, making them more valuable, and enabling them to maximise profits after they list on the stock market.
Shares of all of the targeted companies in these deals are traded on the OTC market and are considered sound shares with high liquidity.
vietnamnews
|
