VI Group-backed logistics player Gemadept divests 51% stake in port JV

Visual taken from Gemadept's website (May 2017)

VI Group-backed logistics firm Gemadept Corporation has completed the divestment of 51 per cent stake in its subsidiary Gemadept – Hoa Sen International Port, according to a disclosure by Ho Chi Minh City Stock Exchange.

Established in 2006, the port was owned 51 per cent by Gemadept while Vietnamese steel producer Hoa Sen Group held the rest. It is located in the area identified in the master development plan of deep-sea container port, close to the river mouth and big industrial zones of Ba Ria Vung Tau, Dong Nai provinces.

Gemadept Corp earlier announced that it has signed a contract to transfer the entire 51 per cent stake in Hoa Sen-Gemadept International Port. The transferee was said to be a South Korean partner.

Hoa Sen Group, meanwhile, also announced the transfer of the entire 45 per cent stake in Gemadept-Hoa Sen International Port. After the transaction, Hoa Sen’s capital ratio fell to zero.

Last year, South Korea’s CJ Logistics acquired a majority stake in two shipping and logistics subsidiaries under Vietnamese logistics company Gemadept Corp.

In a regulatory filing to the Ho Chi Minh Stock Exchange, CJ Logistics completed the purchase of a 50.9 per cent stake each in Gemadept Logistics Holding and Gemadept Shipping Holding, with both deals estimated to be worth 98.7 billion won (about $85 million).

VI Group’s vehicle Vietnam Investment Fund II, LP became a major shareholder of Gemadept last year. It now owns 87.7 million shares, equivalent to 30.4 per cent stake in the logistics firm. The homegrown PE fund earlier owned 64,500 shares, equivalent 0.035 per cent stake in Gemadept.

Founded in 2006, VI Group focuses on high growth businesses in Vietnam. It provides early-stage and expansion capital to industry-leading companies and works with management to grow revenue and margins and improve operations. VIG now manages three funds worth a total of $400 million.

The firm often takes a majority stake where it has industry expertise (via operating partners or co-investors) and is able to add significant value. Its investment can take the form of pure equity, performance-linked equity or convertible debt. VI Group targets an investment horizon of four to six years.

Currently, it is investing in many sectors including transportation and logistics services, tourism and hotel, education, restaurant retail chain, real estate, and technology.

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