Indonesia’s Kimia Farma eyes Growth into Vietnam
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Indonesian state-owned pharmaceuticals firm Kimia Farma is considering expanding into Vietnam by acquiring a local company. The firm recently invested US$10.26 million in a Saudi Arabian firm, purchasing 60 percent of its shares and renaming it as Kimia Farma Dawaa.
It is currently investigating Vietnamese regulations to discover whether or not it can own a majority stake in a local firm, a critical factor in securing its investment.
“It depends on the regulation in the country,” said Kimia Farma finance director IGN Suharta Wijaya. “It the regulation is okay, we will enter the country this year.”
“If the sales of each Kimia Farma outlet in the country is IDR1.5 billion ($104,877) per month, [the sales of an outlet of the Vietnamese company] could be IDR4 billion per month,” Wijaya added.
Investment in the pharmaceutical industry is stepping up in Vietnam, with the announcement last week that Vietnam-focussed private equity firm Mekong Capital has issued funding to pharmacy chain Pharmacity.
With 186 outlets retailing both traditional Vietnamese and Western medicines, Pharmacity is the country’s most widespread network of pharmaceutical products stores, with 1 million subscribers to its loyalty program. The firm is targeting 1000 outlets in Vietnam within two years.
Reportedly, Kimia Farma is seeking to buy a chain with 400 outlets nationwide.
Questions & Answers
Q.What is the key factor Kimia Farma is investigating before potentially entering the Vietnamese market?
What is the key factor Kimia Farma is investigating before potentially entering the Vietnamese market?
Kimia Farma is investigating Vietnamese regulations to determine if it can own a majority stake in a local company. This is a critical factor for securing its investment, according to its finance director.
Q.Has Kimia Farma made any recent international acquisitions before considering Vietnam?
Has Kimia Farma made any recent international acquisitions before considering Vietnam?
Yes, Kimia Farma recently invested US$10.26 million in a Saudi Arabian firm. They purchased 60 percent of its shares and subsequently renamed it Kimia Farma Dawaa.
Q.What is the sales potential Kimia Farma sees in Vietnamese pharmacy outlets compared to its own?
What is the sales potential Kimia Farma sees in Vietnamese pharmacy outlets compared to its own?
Kimia Farma’s finance director stated that a Vietnamese company's outlet could achieve IDR4 billion per month in sales. This compares to IDR1.5 billion ($104,877) per month for each of Kimia Farma’s own outlets.
Q.Which specific company in Vietnam is reportedly being targeted for acquisition by Kimia Farma?
Which specific company in Vietnam is reportedly being targeted for acquisition by Kimia Farma?
The article states that Kimia Farma is seeking to buy a chain with 400 outlets nationwide. However, it does not name a specific company that Kimia Farma is targeting for acquisition.