Muong Thanh Group, Vietnam’s largest private hotel operator, is expanding operation in the country by purchasing a 43 per cent equity stake in Phuong Dong Petroleum Tourism JSC, the owner of the Phuong Dong Hotel.
Le Thanh Than, chairman of Muong Thanh, and his son-in-law, have acquired 39 per cent of the hospitality company; the family had previously owned some four per cent. The seller was Ocean Hospitality – which divested all of its 49.5 per cent holding to Than and his family, and Le Thi Kim Giang (10.5 per cent), for the proceeds of VND50 billion ($2.3 million). The seller said that it will utilise the money in finishing its Starcity Nha Trang Hotel project.
There has been no information whether Giang – the latter buyer – has ties with the family.
The deal adds another popular four-star hotel, based in the central province Nghe An of Vietnam, to Muong Thanh’s network of 48 hotels and projects, some to be launched in 2015 and 2016. The fourth Hanoi-based hotel was inaugurated last month.
Phuong Dong Petroleum Tourism was a former subsidiary of the country’s energy giant PetroVietnam, which then sold 60 per cent of the hotel and tourism business to PetroVietnam Technical Services (PTSC) in 2010. A year later, Ocean Hospitality and Ocean Bank – two arms of financial conglomerate Ocean Group, bought the company. Ocean Bank, which has recently been acquired by the Vietnamese central bank due to insolvency, still holds 10.9 per cent in Phuong Dong Petroleum Tourism.
Meanwhile, the state-owned Saigon Beer – Alcohol – Beverage Corporation owns 9.8 per cent.
Phuong Dong Petroleum Tourism has three businesses, including the hotel, Phuong Dong Travel and Truong Thi restaurant in Ho Chi Minh City. Last fiscal, the company’s profit halved to VND3 billion from 2013. It reported a gain of VND467 million in the first quarter of this year. However, the firm’s accumulated loss still stands at VND37 billion.
Born in 1949 in Nghe An, Than started his career as an infrastructure investor in the northern mountainous region of Vietnam, then expanded in Laos. In 2000, he began building Muong Thanh Hotel and several apartment projects in Hanoi. According to him, Muong Thanh can still make profits, even as the apartments are sold at low prices, because the company is entirely self-funded instead of using bank loans.
In addition to real estate property, Than owns a 35 hectare wildlife reserve area in his hometown.