Vietnamese unicorn VNG pares stake in e-wallet ZaloPay operator

Photo: Zalopay

Vietnamese tech unicorn VNG Corporation has reduced its stake in Zion, the operator of e-wallet ZaloPay, to 60 per cent, according to its financial statement for the fourth quarter of 2019.

VNG owned approximately 100 per cent of Zion before the transaction. It raked in 464 billion dong ($19.9 million) from the sale of its nearly 40 per cent stake in the e-wallet operator.

ZaloPay is one of the most popular e-wallets in the market in terms of the number of customers and transaction volume. In the second quarter of 2019, it was one of the five e-wallets accounting for 95 per cent of transactions, according to data from the State Bank Payment Department.

Established in 2004 as a gaming business, VNG has since expanded into payments, social media and cloud computing. It is Vietnam’s only unicorn, a moniker used for a privately-held startup with a valuation of $1 billion or more.

VNG recorded fourth-quarter net revenues of 1.3 trillion dong, up 14.5 per cent from the same period last year, and profit after tax of 33.5 billion dong, compared to a loss of over 44 billion dong a year ago. The year also saw VNG trim its stake in e-commerce firm Tiki to 24.4 per cent from 28.8 per cent.

In March 2019, Singapore state investor Temasek invested about $29 million in VNG Corporation to own 6.35 per cent of the company’s voting shares. The transaction price was 1.86 million dong ($80.8) apiece, translating into a deal value of $29 million.

The Vietnamese tech major in 2018 released information about its foreign shareholders that included Goldman Sachs, GIC and two British Virgin Island-domiciled investors rumoured to be Chinese giant Tencent’s affiliates. These four shareholders collectively held 43.42 per cent of VNG at the time of the announcement.

Digital payments is one of the most attractive segments in Vietnam’s fintech market. Most recently, China’s Ant Financial, a fintech affiliate of e-commerce giant Alibaba Group Holding Ltd, was reported by Reuters to have built a sizable stake in Vietnamese e-wallet firm eMonkey.

Some of the notable deals in this space include a $300-million financing for VNPAY by SoftBank and GIC, and Warburg Pincus’s investment in MoMo, which was estimated to be around $120 million.

The market has also seen a fair share of consolidation. Ant Financial-backed Thai firm Ascend Money has acquired 1Pay, while NTT Data bought Payoo. Singapore’s Sea Ltd owns AirPay, Grab has invested in Moca and VNPT E-Pay is majority-owned by South Korean fund UTC Investment.

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.