Myanmar tycoon open to foreign investment in wake of Ayala-Yoma deal

Downtown Yangon, Myanmar. Photo: Pixabay

Myanmar tycoon Win Aung is open to foreign investment in the listed industrial-estate provider he oversees, following Ayala Corp.’s tie up with a firm traded on the nation’s fledgling stock exchange.

In an interview in Yangon, Win Aung said a stake sale is an option as he plans to expand Myanmar Thilawa SEZ Holdings Pcl, which operates a manufacturing zone where 109 firms have opened factories or plan to do so.

“We’ll need more capital and technology,” Win Aung, the firm’s chairman, said Thursday. “Detailed plans will be revealed later after the authorities officially allow foreigner participation on the Yangon Stock Exchange.”

Myanmar is trying to expand a stunted bourse that currently has just five stocks by allowing overseas purchases of domestic equities from 2020. The Philippines’ oldest conglomerate Ayala is investing in one of those five — First Myanmar Investment Pcl — via an $82.5 million convertible loan that will become a 20% shareholding when rules permit.

The four-year-old Thilawa special economic zone is viewed by some as the largest in Myanmar. Japanese, Thai and Malaysian firms account for the bulk of the factories located there, according to Win Aung.

Trade War

Myanmar’s business community hopes to benefit from the U.S.-China trade war by luring manufacturers fleeing tariffs. Win Aung said the tension had yet to impact Thilawa significantly.

“But Myanmar is in a good position to benefit from the trade war,” he said. “It’s really important that the government sets the right policies on how to attract potential investors.”

Win Aung is also the founder and chairman of conglomerate Dagon Group. He was on the U.S. government’s list of “specially designated nationals” until 2015, under a sanctions program that targeted individuals and entities when the country was run by a military junta.

Net foreign-direct investment into Myanmar collapsed to 1.8% of gross domestic product last year from 6% in 2017, World Bank data shows.

That reflected in part a souring of sentiment after the Rohingya refugee crisis flared up in Rakhine state in the second half of the same year.

At the same time, some firms remain interested in gaining exposure to Myanmar’s high levels of economic growth.

Ayala is placing a $237.5 million bet on the nation by linking up with one of the country’s best known tycoons, Serge Pun. The deal includes the potential equity stake in First Myanmar Investment.

Bloomberg

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.