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Jardine Cycle & Carriage "mystery" buyer of Vinamilk stake

Released at: 20:31, 13/11/2017

Jardine Cycle & Carriage "mystery" buyer of Vinamilk stake

Photo: Viet Tuan (VET)

Singapore-listed company acquires 5.53% for $616.6 million at auction and via open market purchases.

by Quang Huy

The Singapore-listed automotive group Jardine Cycle & Carriage Limited (JC&C) announced on November 13 that it acquired a 5.53 per cent stake in Vietnamese dairy giant Vinamilk through two back-to-back transactions for an aggregate investment of $616.6 million.

Jardine, through its wholly owned subsidiary Platinum Victory Pte Ltd, picked up 3.33 per cent stake at an auction on November 10 and bought the remaining shares, amounting to 2.2 per cent, through open market purchases.

The State Capital Investment Corporation (SCIC) last week announced it had sold 3.33 per cent of its holding in Vinamilk to an undisclosed overseas institutional investor for almost VND9 trillion ($396.5 million).

This was the remaining portion of the 9 per cent it offered in December 2016, when only Fraser & Neave expressed interest and acquired 5.4 per cent for approximately $500 million. Investors looking to gain a degree of control over Vinamilk were partly deterred by the small size of the stake on offer.

Vinamilk, which holds a 58 per cent market share in the domestic dairy industry, was valued at $10.9 billion on the day of the JC&C investment.

“The taking of this interest in Vinamilk is in line with JC&C’s strategy of investing in market leading companies in Southeast Asia,” the Singapore investor said in a statement. “In particular, it increases JC&C’s exposure to the Vietnamese economy, and consideration will be given from time to time to making further such investments.”

JC&C has been present in Vietnam through its 25.1 per cent holding in the country’s largest automotive firm, Truong Hai Auto, as well as a 22.9 per cent holding in the listed Refrigeration Electrical Engineering Corporation (REE).

JC&C is a unit under the diverse group Jardine Matheson, which also has interests in other businesses in Vietnam, including the Asia Commercial Bank, Pizza Hut, KFC Vietnam, and several real estate assets.

Vinamilk shares rose nearly 4 per cent on November 13 to a record VND181,500 ($8).

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