GIC makes another Vietnam bet with Masan Group stake

Ho Chi Minh City

GIC, Singapore's sovereign wealth fund, is making another bet on Vietnam by purchasing a stake in local conglomerate Masan Group Corp, people with knowledge of the matter said.

The state investment firm bought roughly half of KKR & Co's 4.7 per cent stake in Masan, according to the people, who asked not to be identified because the information is private. It purchased the stock as part of an overnight placement by KKR, which offloaded its entire holding in a US$209 million deal, the people said.

An investment in Masan will join GIC purchases in Vietnam's airlines, banking and real estate industries. GIC chief executive officer Lim Chow Kiat said last month that he sees potential opportunities in emerging markets, which are experiencing "idiosyncratic" rather than "systemic" challenges.

A spokeswoman for GIC said she couldn't immediately comment. A representative for KKR declined to comment.

GIC played a part in Vietnam's top three equity offerings ever, all of which were completed in the past year. It invested about US$1.3 billion in luxury developer Vinhomes JSC ahead of its May initial public offering, which was the country's biggest-ever share sale.

The fund was a cornerstone buyer in the US$922 million IPO of Techcombank, a Vietnamese lender backed by Warburg Pincus. It was also a cornerstone investor in mall operator Vincom Retail JSC's 2017 listing and emerged a substantial shareholder of VietJet Aviation JSC before the budget airline's stock market debut earlier that year.

KKR is exiting its Masan investment after shares of the Vietnamese conglomerate more than doubled. The private equity firm sold 54.8 million Masan shares at 89,200 dong apiece, the mid-point of a marketed range, people with knowledge of the matter said earlier Friday.

The sale price represents a 5 per cent discount to Masan's Thursday close. The shares were offered at 87,800 dong to 90,600 dong each, according to terms for the deal obtained by Bloomberg earlier.

KKR's offering was oversubscribed with strong demand from long-only funds and local investors, one of the people said. The top five investors who participated bought about 85 per cent of the offering, the person said.

In April 2017, KKR said it was buying US$100 million of Masan stock from Danish private equity firm PENM Partners. It also spent another US$150 million for a stake in Masan's meat business, according to a statement at the time.

Masan shares have risen 109 per cent from KKR's announcement of the investments' completion through Thursday, compared with a 44 per cent gain in the benchmark VN Index over the period. BLOOMBERG