Masan Group Corporation (Masan) and SK Group have announced the signing of an agreement to acquire shares of The CrownX (TCX) for a total cash consideration of USD 345 million, of which SK Group invested USD 340 million. Following the Transaction, Masan and SK’s ownership ratios in The CrownX are 85.0% and 4.9%, respectively. Masan may increase its ownership ratio in TCX in the near future.
Continuously attracting huge capital sources
SK Group, one of the largest chaebols in Korea, has made large investments in Masan. In 2018, SK spent nearly VND 11,000 billion, equivalent to USD 470 million, to buy back 110 million treasury shares of Masan Group. In April 2021, SK Group continued to spend USD 410 million to buy 16.26% of WinCommerce shares (formerly known as VinCommerce). In total, Korean investors have "poured" more than USD 1.2 billion into Masan and its member companies. This is also SK's largest investment in the Vietnamese market.
Sharing more about SK’s continued investment in Masan, Mr. Woncheol Park, Representative Director of SK South East Asia Investment said: “Masan Group has always received our absolute support on its development path. We believe that Masan’s growth strategy by replicating the “mini-mall” model and the Group’s consumer platform will reap brilliant results, bringing great benefits to consumers, partners and shareholders.”
In May 2021, a group of investors, including Alibaba and Baring Private Equity Asia, signed an agreement with Masan Group (MSN) to purchase newly issued shares of The CrownX - a subsidiary of Masan - for a total value of 400 million USD, equivalent to owning 5.5% of capital after issuance. The CrownX is Masan's retail consumer platform established based on the merger of Masan Consumer Holdings (MCH) and WinCommerce (WCM) - the owner of the VinMart/ VinMart+ chain. This transaction, according to a representative of The CrownX, also reinforces the shareholders' vision of the potential to build Vietnam's first technology-based consumer - retail ecosystem, while expanding the scope of service to consumers nationwide.
Continuously making a mark of success
After successfully improving profits at WinCommerce (WCM) and recording the first quarter of net profit for this retail chain (Q3/2021), Masan's priority in the coming time is to accelerate the expansion of the mini-mall model at TCX. This model is part of the "Point of Life" strategy, integrating WinMart+ (essentials), Phuc Long kiosk (tea and coffee), Phano (pharmaceuticals), Techcombank (financial utilities) and Mobicast (new mobile network operator owning the Reddi brand) into a customer loyalty platform.
The initial success of the VinMart+ model integrated with the Phuc Long kiosk chain shows a clear improvement in profit margins. The Phuc Long kiosks that have been in operation have contributed an additional VND5 million to VinMart/VinMart+ revenue, helping to improve the EBITDA margin of these stores by nearly 4%. According to the plan, Masan will deploy shop-in-shop, expecting to have more than 1,000 Phuc Long kiosks integrated at Wincommerce points of sale by the end of 2021. profit margin and reach VND1,750 billion in revenue/year with the kiosk model.
Another significant breakthrough is when Masan expanded into the telecommunications sector by spending VND295.5 billion to buy back 70% of Mobicast shares. This is the first step for Masan to digitize the “Point of Life” consumer ecosystem and bring integrated product and service experiences from offline to online. “Point of Life” is the only consumer ecosystem serving from necessities, financial services to digital services. These are essential services that account for 80% of Vietnamese consumer spending.
This model is similar to Reliance Jio, which has been a huge success in India. Masan’s efforts to transform and meet the needs of modern consumers have been consistent and continuous in providing superior products and services to 100 million Vietnamese people and helping consumers pay less for their daily essentials. The pilot stores under the mini-mall model have achieved initial successful results with increased customer traffic and significantly improved profits. In the upcoming medium-term strategy, Masan will re-expand its scale nationwide, while maintaining profitability through key indicators such as: Increasing the contribution of private label portfolio, accounting for 20-25% of modern retail channel sales; Promoting the trend of shopping for essentials on online channels, aiming for online channels to contribute over 5% to total revenue or reaching 50,000 orders/day; Convert 2,000 – 3,000 traditional retail partners of Masan Consumer Holdings into WCM franchise partners; and Develop a loyalty program and payment system through mobile wallet to bring long-term value to consumers, while maintaining a low-cost new customer acquisition model.
“SK’s investment agreement affirms our strong belief in the success of the mini-mall model on a national scale, contributing to bringing outstanding values to consumers every day. Masan’s next leap is to promote the development of its loyalty customer base and accelerate digitalization to fully serve the essential needs of consumers, from products to services on both offline and online channels,” said Danny Le, CEO of Masan Group.
Masan aims to close a capital raising round worth $200 to $300 million in TCX before the end of this year.
Source: CafeF
Continuously attracting huge capital sources
SK Group, one of the largest chaebols in Korea, has made large investments in Masan. In 2018, SK spent nearly VND 11,000 billion, equivalent to USD 470 million, to buy back 110 million treasury shares of Masan Group. In April 2021, SK Group continued to spend USD 410 million to buy 16.26% of WinCommerce shares (formerly known as VinCommerce). In total, Korean investors have "poured" more than USD 1.2 billion into Masan and its member companies. This is also SK's largest investment in the Vietnamese market.
Sharing more about SK’s continued investment in Masan, Mr. Woncheol Park, Representative Director of SK South East Asia Investment said: “Masan Group has always received our absolute support on its development path. We believe that Masan’s growth strategy by replicating the “mini-mall” model and the Group’s consumer platform will reap brilliant results, bringing great benefits to consumers, partners and shareholders.”
In May 2021, a group of investors, including Alibaba and Baring Private Equity Asia, signed an agreement with Masan Group (MSN) to purchase newly issued shares of The CrownX - a subsidiary of Masan - for a total value of 400 million USD, equivalent to owning 5.5% of capital after issuance. The CrownX is Masan's retail consumer platform established based on the merger of Masan Consumer Holdings (MCH) and WinCommerce (WCM) - the owner of the VinMart/ VinMart+ chain. This transaction, according to a representative of The CrownX, also reinforces the shareholders' vision of the potential to build Vietnam's first technology-based consumer - retail ecosystem, while expanding the scope of service to consumers nationwide.
Continuously making a mark of success
After successfully improving profits at WinCommerce (WCM) and recording the first quarter of net profit for this retail chain (Q3/2021), Masan's priority in the coming time is to accelerate the expansion of the mini-mall model at TCX. This model is part of the "Point of Life" strategy, integrating WinMart+ (essentials), Phuc Long kiosk (tea and coffee), Phano (pharmaceuticals), Techcombank (financial utilities) and Mobicast (new mobile network operator owning the Reddi brand) into a customer loyalty platform.
The initial success of the VinMart+ model integrated with the Phuc Long kiosk chain shows a clear improvement in profit margins. The Phuc Long kiosks that have been in operation have contributed an additional VND5 million to VinMart/VinMart+ revenue, helping to improve the EBITDA margin of these stores by nearly 4%. According to the plan, Masan will deploy shop-in-shop, expecting to have more than 1,000 Phuc Long kiosks integrated at Wincommerce points of sale by the end of 2021. profit margin and reach VND1,750 billion in revenue/year with the kiosk model.
Another significant breakthrough is when Masan expanded into the telecommunications sector by spending VND295.5 billion to buy back 70% of Mobicast shares. This is the first step for Masan to digitize the “Point of Life” consumer ecosystem and bring integrated product and service experiences from offline to online. “Point of Life” is the only consumer ecosystem serving from necessities, financial services to digital services. These are essential services that account for 80% of Vietnamese consumer spending.
This model is similar to Reliance Jio, which has been a huge success in India. Masan’s efforts to transform and meet the needs of modern consumers have been consistent and continuous in providing superior products and services to 100 million Vietnamese people and helping consumers pay less for their daily essentials. The pilot stores under the mini-mall model have achieved initial successful results with increased customer traffic and significantly improved profits. In the upcoming medium-term strategy, Masan will re-expand its scale nationwide, while maintaining profitability through key indicators such as: Increasing the contribution of private label portfolio, accounting for 20-25% of modern retail channel sales; Promoting the trend of shopping for essentials on online channels, aiming for online channels to contribute over 5% to total revenue or reaching 50,000 orders/day; Convert 2,000 – 3,000 traditional retail partners of Masan Consumer Holdings into WCM franchise partners; and Develop a loyalty program and payment system through mobile wallet to bring long-term value to consumers, while maintaining a low-cost new customer acquisition model.
“SK’s investment agreement affirms our strong belief in the success of the mini-mall model on a national scale, contributing to bringing outstanding values to consumers every day. Masan’s next leap is to promote the development of its loyalty customer base and accelerate digitalization to fully serve the essential needs of consumers, from products to services on both offline and online channels,” said Danny Le, CEO of Masan Group.
Masan aims to close a capital raising round worth $200 to $300 million in TCX before the end of this year.
Source: CafeF
Source: https://www.masangroup.com/vi/news/market-news/Why-has-Korean-chaebol-invested-over-1-2-bn-in-masan-and-its-subsidiaries.html
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