Mekong Capital-backed logistics company ABA Cooltrans has raised $6 million through a convertible bond from Vietnam Holding Limited (VNH) to expand its cold chain logistics solutions in Vietnam.
VNH is an investment vehicle managed by Dynam Capital, which has been investing in Vietnamese equities since 2006. Its portfolio includes technology major FPT, Saigon Cargo Services, MBBank, Phu Nhuan Jewelry and Mobile World Group.
ABA Cooltrans, established in 2008, provides integrated cold chain services focused on the domestic market, with assets covering nearly 300 refrigerated trucks and 40,000 pallets of cold storage in Hanoi and Ho Chi Minh City.
The company’s clients include large modern retailers such as VinMart, Bach Hoa Xanh and BigC, as well as suppliers providing meats, dairy products and fresh produce, such as Masan Nutri-Science, Bel Vietnam and Unilever.
“ABA’s growth has been directly linked to the increasing demand for fresh and safe food by Vietnamese consumers,” said Luong Quang Thi, founder and CEO of ABA. “Controlling temperature throughout the supply chain requires a much higher degree of investment for logistics providers. The investment from Vietnam Holding Limited will allow us to build our current resources into a one-stop supply chain, as well as to develop the technology platform, strengthen our human resource and build a corporate culture focused on our clients and the quality of their products,” he added.
ABA Cooltrans has roped in William O’Brien, former president of HAVI Logistics’ Asia operations, as an independent expert to support its operations.
“Vietnam Holding has invested significantly in the consumer retail and logistics space in Vietnam. As the modern trade portion of the market grows in Vietnam, ensuring food safety and quality across the ‘farm to fork’ chain becomes increasingly important,” said Vu Quang Thinh, CEO of Dynam Vietnam.
Mekong Capital had pumped an undisclosed sum in ABA Cooltrans in 2016 out of its current fund, the $112.5-million Mekong Enterprise Fund III (MEF III) which invests in local growth-stage companies in consumer-driven sectors such as retail, restaurants, logistics and consumer products and services.
The firm, one of Vietnam’s pioneering private equity fund managers, will be raising its next vehicle this year as it fully deploys MEF III, its partner Chris Freund told us earlier.
Recently, pawnshop chain F88, another portfolio company of Mekong Capital, raised 100 billion Vietnamese dong through a bond.