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Mekong Capital to gradually divest from MobileWorld

Released at: 15:49, 27/12/2014

Mekong Capital to gradually divest from MobileWorld

PE-focused firm to sell 2.24 million shares as part of steady exit from mobile phone retailer.

by Thong Dat

The Mekong Enterprise Fund II (MEF II), managed by Mekong Capital, has registered to sell 2.24 million shares of Mobile World Investment Corporation (MWG) to foreign institutional investors.

The move was confirmed by Mr. Chris Freund, Managing Partner of Mekong Capital. “MEF II intends to sell 2 per cent of MWG in a block trade, or a series of block trades, to foreign institutional investors who have expressed interest in it,” he told Vietnam Economic Times.

MEF II, which holds 14.3 per cent of MWG, will sell 2.24 million shares at VND105,000 ($5) each for a total consideration of VND235 billion ($211 million). After the transaction, MEF II will continue to hold 13.02 million MWG shares, equal to 12.22 per cent of the company’s issued shares.

The PE-focused firm initially invested $3.5 million to secure more than 30 per cent of MobileWorld in 2007. With the ten-year lifespan of MEF II ending in mid-2016, Mr. Freund confirmed that MEF II intends to sell its remaining MWG shares before that time but it is expected to be a gradual process.

Foreign investors own a total 46.45 per cent of shares in MWG. Last month, CDH Bee Electric Limited Company, one of its shareholders, sold as many as 3.2 million shares to Mutual Fund Elite for VND351.9 billion ($16.75 million). As a result of the transaction CDH Bee Electric and Mutual Fund Elite now own 12.33 per cent and 6.88 per cent, respectively, of MWG’s charter capital.

MEF II is the second of three funds managed by Mekong Capital. The fund has made a total of ten investments since its inception and is currently holding three after fully divesting from seven. Meanwhile, MWG Corporation reported after-tax profit of VND488 billion ($23 million) and consolidated revenue of more than VND10.9 trillion ($519 million) in the first nine months of 2014.

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