Singapore's Nova Buildings acquires BlueScope's pre-fab buildings business in Vietnam

SINGAPORE-based private equity firm Fintonia Group has led a management buyout of BlueScope Buildings' pre-engineered buildings business in Vietnam.

The newly-formed Nova Buildings, headquartered in Singapore, will take over ownership and operations of BlueScope's key fabrication assets at Bien Hoa City in Dong Nai Province, led by key operational team members who formerly managed facilities under BlueScope Buildings.

The plant will serve as Nova Buildings' key manufacturing site and main export hub for the South-east Asia region. BlueScope Buildings is a global manufacturer of engineered building solutions.

Nova Buildings and Fintonia declined to comment on the size of the deal. But it could cost more than US$10 million to build the same assets greenfield, The Business Times (BT) understands.

Viktor Dimitrov, chief executive of Fintonia, told BT: "This is an opportunity to enter a growing and highly promising market niche within construction and engineering services. The pre-engineered buildings (PEB) market in Asean is estimated to be at least S$500 million. It is a high-growth market in South-east Asia, as PEB is increasingly preferred for new industrial and logistics developments.

"PEB's penetration in target markets is 10-15 per cent, whereas in more advanced markets, it would be 90 per cent of total new developments."

Nova is fully functional with local business entities incorporated in Indonesia, Malaysia, Thailand and Vietnam, and has full coverage of the key growth markets in Asean, Mr Dimitrov added.

Fintonia's investment was made alongside Nova's management team. Nova chief executive Cheong Ku Wei told BT: "The acquired facility and its equipment are in good operating conditions and readiness, and able to fabricate high-quality pre-engineered frames that meet various international design and engineering codes.

"Furthermore, it gives Nova the ability to source competitive and good-quality steel plates in Vietnam, along with the competitive and skilled labour pool in Vietnam. These factors allow Nova Buildings to fabricate and ship competitive and high-quality pre-engineered frames for our customers' projects across the region.

Over the next few years, Nova Buildings will look to establish a market presence in the Philippines and the emerging Indochina countries, Mr Cheong said.