Vietnam-focused PE firm says COVID-19 to delay the close of fifth fund

Hanoi, Vietnam. Photo: Florian Wehde

Vietnam-focused Danish private equity firm PENM Partners, which is in the market to raise its fifth fund, expects a bumpy road ahead in the aftermath of the novel coronavirus, according to a senior executive.

The firm is seeking to raise about $150 million for PENM V, the same as its predecessor, Hans Christian Jacobsen, managing partner of PENM Partners, told DealStreetAsia.

“We were supposed to raise the fund by mid this year. But the coronavirus has caused a lot of uncertainties, so the end of this year or early next year would be more realistic,” he said.

“In Europe, China or Vietnam, investors are putting on hold to see how it will work out.” PENM Partners’s limited partners (LPs) include Danish pension fund PKA.

The general partner also expects the investment scene in Vietnam to normalise in three to six months, given the Southeast Asian country has not been affected as much as countries such as China or Italy.

PENM V will continue to commit to PE investments in Vietnam focused on the consumer theme, Jacobsen added.

Besides making new investments, the fifth fund will look at opportunities to double down on existing portfolio companies. Jacobsen said the firm’s current vehicle, PENM IV, could still make two or three more investments.

When it comes to sealing new deals, Jacobsen asserted that valuations remain unrealistic. “Especially in the present situation, many companies have seen sales down by up to 60 per cent,” he said.

PENM Partners has invested in Vietnamese businesses across the fields of manufacturing, agriculture, foods, retail and services, such as steel major Hoa Phat Group, diversified company Masan Group, Taseco Airs, GTN Foods, International Consumer Products and Loc Troi.

It has also realised almost 20 investments. The firm disposed of its past portfolio through both IPO and sales to strategic investors.

In 2017, it scored a big exit from Masan to American PE giant KKR for $100 million. Eight years earlier, PENM Partners, then known as BankInvest, and TPG Growth had announced a $50-million co-investment in Masan, in which TPG Growth poured an amount of $35 million.

“In the past, we sold [our portfolio companies] to European and US investors as well as Vietnamese investors. Now, there is a lot of interest from Japan and South Korea. The exit environment is reasonable,” said Jacobsen.

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.

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.