* Vincom Retail has seven assets valued at around $1.1
* Warburg, an investor in Asia since 1994, makes first
* Deal is biggest first-time investment by global pvt equity
firm in Vietnam
By Stephen Aldred
HONG KONG, May 29 A consortium led by U.S.
buyouts fund Warburg Pincus said on Wednesday it has
agreed to buy around 20 percent of the retail unit of Vietnam's
Vingroup Joint Stock Co for $200 million, betting on
retail growth in the Asian country.
The unit, Vincom Retail, is Vietnam's largest owner and
operator of shopping malls with seven assets valued at around
$1.1 billion, and the deal bucks a trend in the country where
real estate sector growth has slumped as credit growth slows and
banks are mired in non-performing loans.
Hanoi-based Vincom shares ended the morning session down
2.24 percent on the benchmark VN index in Ho Chi Minh
City before the announcement was made.
Vincom's assets include high-end malls Vincom Center B in Ho
Chi Minh City and Vincom Center Ba Trieu in Hanoi, targeted to
tap Vietnam's growing consumer market.
The deal is Warburg's first investment in Vietnam, and it is
the largest initial investment to date in a Vietnamese company
by a global private equity firm.
Warburg, which manages over $40 billion in assets and has
been investing in Asia since 1994, said the investment in Vincom
Retail should benefit from the country's "favorable long-term
economic outlook," rapid urbanisation and growing middle class.
Warburg has the right to participate in future capital
raisings by Vingroup for up to $25 million, while the consortium
has the right to invest an additional $100 million in Vincom
Retail for expansion and future retail property-related deals.
Vincom has two further projects due to launch this year,
Vincom Mega Mall Royal City and Vincom Mega Mall Times City.
Vingroup is Vietnam's largest private-sector real estate
operator and one of the largest companies by market
capitalisation on the Ho Chi Minh City Stock Exchange.
Citigroup Inc was hired as the sole financial advisor
to Vingroup, while Credit Suisse Group was sole
financial advisor to Warburg Pincus.