South Korea’s SK Group to buy $1 bln stake in Vingroup
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South Korean conglomerate SK Group plans to acquire a $1 billion stake in Vietnam’s largest private conglomerate Vingroup. SK plans to make the investment as early as next month, it said. Vingroup recently sought its shareholders’ vote on a plan to raise at least VND25 trillion ($1.08 billion) through a private placement to five foreign investors.
It plans to sell the shares at a minimum price of VND100,000 ($4.32) and stipulate a lockup period of one year, during which time the shares cannot be resold by the buyers.
It plans to use VND10 trillion ($432.34 million) of the proceeds to restructure its debts, VND6 trillion ($259.41 million) to invest in its auto company VinFast, technology firm VinTech and smartphone maker Vinsmart.
Vingroup is Vietnam’s largest listed company by market capitalization and is worth VND377 trillion ($16.23 billion).
Last September SK Group acquired a 9.5 percent stake in Vietnam’s diversified business Masan Group for $470 million.
Questions & Answers
Q.When is SK Group planning to make this investment in Vingroup?
When is SK Group planning to make this investment in Vingroup?
SK Group stated its intention to make the investment as early as next month. This timeline aligns with Vingroup's plan to raise funds through a private placement.
Q.What is Vingroup's primary reason for raising this capital?
What is Vingroup's primary reason for raising this capital?
Vingroup plans to use VND10 trillion of the proceeds to restructure its debts. Another VND6 trillion will be invested in its auto, technology, and smartphone companies.
Q.Are there any restrictions on the foreign investors once they acquire shares?
Are there any restrictions on the foreign investors once they acquire shares?
Yes, the plan includes a one-year lockup period during which the shares cannot be resold by the buyers. This ensures a degree of stability for the investment.
Q.Has SK Group invested in other Vietnamese companies recently?
Has SK Group invested in other Vietnamese companies recently?
Yes, SK Group acquired a 9.5 percent stake in Vietnam's diversified business Masan Group last September. That investment was valued at $470 million.
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