The proposed IPO would make VNG, which is backed by Goldman Sachs and Singapore sovereign wealth fund GIC, the first firm from Vietnam to list overseas.
The company’s agreement with Nasdaq was signed on the sidelines of Vietnam Prime Minister Nguyen Xuan Phuc’s visit to the US. Robert McCooey, vice president of the American stock exchange, spoke highly of VNG as a “symbol for the Vietnamese economy” and pledged to facilitate its listing on the bourse.
A Bloomberg report quoted VNG co-founder and CEO Le Hong Minh as saying the listing process could take 18 to 24 months. The company did not disclose the IPO size.
“With the prospective listing of a Vietnamese tech company on Nasdaq, it will draw attention from the global tech and finance industries to Vietnam,” an official VNG statement said.
The VNG announcement comes close on the heels of reports that Southeast Asia’s biggest startup Sea, formerly known as Garena, has filed for a $1-billion IPO in the US. Sea is considering listing in early 2018.
With Southeast Asian stock markets lacking depth, especially when it comes to tech companies, startup founders and investors are left with fewer exit options such as IPOs. In a report last year, Singapore-based venture capital firm Golden Gate Ventures pointed out that there have been only 11 tech IPOs in Southeast Asia since 2005.
It is no surprise then that startups from the region are turning to the US for their IPOs. Nasdaq, which has a market cap of $6.8 trillion, is the listing home to global tech majors such as Apple, Microsoft, Google, Facebook and Ebay.
VNG was founded in 2004 as a game publisher, but has since then expanded to digital content, social app, software and e-commerce. Its Zing online video and music streaming services are very popular in the country, while Zalo messaging app has gained a 70 million-strong user base across Vietnam, Myanmar, Japan, South Korea, Malaysia and Taiwan.
In addition, the company operates payment gateway 123pay and cinema ticket app 123phim. In 2016, VNG acquired 38 per cent of e-commerce company Tiki for $17 million.
Prior to VNG, Vietnam’s first private airliner Vietjet had planned an overseas listing. The carrier has recently said it will work with stock exchanges in Hong Kong, Singapore, London and New York to help it list shares abroad. However, it has not made a decision on the listing destination.
Other Southeast Asian firms to have listed on Nasdaq include Malaysia’s MOL Global. The firm had to delist last year, just two years after its $169-million listing, as share prices tumbled below $1.