Foreign investors find stake acquisitions fit in Vietnam energy race

By Nguyen Thuy
Sun, October 23, 2022 | 1:02 pm GMT+7

Vietnam’s booming clean energy market has been urging foreign firms to get involved, with acquiring stakes from domestic investors probably a more convenient way.

A solar power farm invested by Trungnam Group in Tra Vinh province, southern Vietnam. Photo courtesy of the company.

A solar power farm invested by Trungnam Group in Tra Vinh province, southern Vietnam. Photo courtesy of the company.

Vietnam in 2020 overtook Thailand as Southeast Asia’s largest renewables market, according to the World Bank, and Thai companies were the first group among foreign investors to launch an acquisition wave in the country. Other multinationals have since followed suit.

DNV, a global independent energy expert and assurance provider, announced Friday that it advised Actis, a leading global investor in sustainable infrastructure, on its acquisition of a majority stake in Singapore-headquartered Levanta Renewables, a Vietnam and Southeast Asia-focused renewables platform.

Actis announced the deal this August, adding that it has 300 megawatts of onshore wind power projects in Vietnam.

DNV said it has provided technical due diligence for the 300 MW portfolio of the ready plants, in addition to a 1,500 MW pipeline of projects.

The firm said as the advisor, it was asked to assess Vietnam’s commercial bankability and identify risks across a wide range of technical issues that may impact valuation of the renewable energy assets.

This Levanta acquisition is Actis’ first energy infrastructure investment in Vietnam and will support the country’s net-zero target by 2050. It follows Actis’ expansion plans.

“Actis has worked closely with DNV on a number of assignments within the Asean region and appreciates the combination of commercial pragmatism with technical expertise within an understanding of the needs and challenges of a due diligence process,” Actis CEO Liam Smith said in a release.

“Actis’ steadfast focus on expanding the installation of renewable energy plants in growth markets coupled with their ability to apply international environmental, social and governance standards in their investments creates tremendous value,” said Benoit Nguyen, head of Renewables - Southeast Asia, Energy Systems, DNV.

Nguyen served as DNV’s country manager in Vietnam from February-June 2021 when he moved to his current post, based in Singapore.

Vietnam's renewable energy market is offering many acquisition opportunities. Fecon, a Vietnamese enterprise in infrastructure construction, is seeking to sell all of its 40% stake in the $58 million Vinh Hao 6 solar power plant in the south-central province Binh Thuan, which began commercial operations in 2019.

Saudi Arabian utilities giant Acwa Power holds a 60% stake in the 50 MW plant as a result of a stake acquisition the same year.

Fecon and multinational power firm Corio Generation signed a joint development agreement this June for a proposed 500 MW offshore wind farm in Ba Ria-Vung Tau province bordering Binh Thuan. It could be among the first large-scale offshore wind projects to be built in Vietnam, once licenses and approvals are obtained.

In July, insiders said Vietnamese conglomerate Trungnam Group was considering selling a minority stake in its renewable energy assets. According to sources, who asked not to be named as the process is private, the corporation mulled over selling a 30% to 35% stake in its portfolio comprised mainly of wind and solar projects, a deal that might be valued its total assets at more than $1 billion.

Vinh Hao 6 solar power plant in Binh Thuan province, south-central Vietnam. Photo courtesy of Fecon Company.

Vinh Hao 6 solar power plant in Binh Thuan province, south-central Vietnam. Photo courtesy of Fecon Company.

In June, EDP Renovaveis, S.A., a top renewable energy firm in Spain, reached an agreement worth $284 million with Xuan Thien Group, a main power developer in Vietnam, to acquire two solar power projects in Ninh Thuan province which borders Binh Thuan. The two projects, totaling 200 MW, alternating current (MWAC), or 255 MW, direct current (MWDC), were put into commercial operation in April 2020.

French renewable energy giant EDF Renewables announced in October 2021 it had made a significant investment in SkyX Energy, a subsidiary of Vietnamese leading investment company VinaCapital and the operator of rooftop solar power plant SkyX Solar.

EDF did not disclose how much it invested, just saying that it assisted with the new partnership, and that SkyX Solar was expected to invest at least $100 million in developing 200 more MW of rooftop solar within the next two to three years.

At present, EDF and VinaCapital are seeking Vietnamese authorities’ nod to make initial surveys on a 3 GW wind power project offshore of Vung Tau.

Vietnam 2020 catch-up game with Thailand

Thai power firms got busier during 2020 in the Vietnamese renewables market. In December, the 50 MW Phong Dien II solar power plant commercially switched on in the central province of Thua Thien-Hue after it was just bought by Thai energy firm Gunkul Engineering Plc for $39.9 million. The Stock Exchange of Thailand-listed companies said the transaction was completed late that November.

The full take-over included the purchase of 49% of shares from Bangjak Green Energy Co, a subsidiary unit of Bangkok-based BS Industry Service Co, and 51% of shares from two individual Vietnamese shareholders.

The two women were Tran Thi Huong Hoa, who held a 46% stake, and Phan Thi Bich Nga with 5%. Therefore, more than $20 million from the Thai company into their pockets was reportedly a big profit, but exact gains were undisclosed.

The acquisition was part of Gunkul Engineering’s plans to expand in Southeast Asian renewables, which the company said have low risk and high growth potential. Toward the end, it went on to buy the Tan Chau solar plant in southern Vietnam’s Tay Ninh province bordering Cambodia for a reported $47 million, its fourth such acquisition in a row in 2020 alone. The plant began operations in October of that year.

In the same province, which also borders Ho Chi Minh City, two solar power plants with a combined power generation of 60 MW were bought in February 2020 by Gunkul Engineering at a total price of $60.6 million. Tri Viet 1 and Bach Khoa A Chau 1, each with a capacity of 30 MW, commercially started operation in May 2019.

Gulf Energy Development, another Thai firm, increased its ownership in two solar farms TTC 1 and 2 in the province from 49% in 2019 to 90%. The deals were made with its Vietnamese partner Thanh Thanh Cong Group, whose ecosystem also includes industrial and tourism real estate, as well as agriculture.

Other Thai companies with merger and acquisition deals to invest in the Vietnamese power sector include B. Grimm, BC Container Glass, and Begistics. Among them, B. Grimm’s presence is bolder.

B.Grimm Power, Siemens Energy, and U.S.-based company Energy Capital Vietnam (ECV) embarked on their consortium last December to develop the LNG-to-power Mui Ke Ga project in Binh Thuan, estimated to cost $1.75 billion to build. The 3,200 MW project has not been licensed yet.

Comments (0)
  • Read More
Vietnam startup expert closes Monkey in Black coffee shop

Vietnam startup expert closes Monkey in Black coffee shop

Tung BT (Tran Thanh Tung), a popular startup expert and social media influencer, is closing his final coffee shop in Ho Chi Minh City, ending a 10-year journey of the "Monkey in Black" brand.

Companies - Thu, November 21, 2024 | 8:16 am GMT+7

Vietnam-Singapore ties set for elevation to comprehensive strategic partnership

Vietnam-Singapore ties set for elevation to comprehensive strategic partnership

Vietnam and Singapore will elevate bilateral ties to a comprehensive strategic partnership and Singaporean Prime Minister Lawrence Wong will visit Vietnam next year.

Politics - Wed, November 20, 2024 | 8:16 pm GMT+7

Vietnam’s Vingroup establishes robotics firms, with co-founder’s 2 sons as major shareholders

Vietnam’s Vingroup establishes robotics firms, with co-founder’s 2 sons as major shareholders

Vingroup, Vietnam’s largest private conglomerate by ecosystem, has set up a robotics unit as it moves to ramp up its industrial-high technology ecosystem.

Companies - Wed, November 20, 2024 | 6:17 pm GMT+7

E-commerce, digital platforms likely to pay taxes on behalf of their sellers in Vietnam

E-commerce, digital platforms likely to pay taxes on behalf of their sellers in Vietnam

E-commerce and digital platforms will have to declare and pay taxes on behalf of their sellers starting January 1, 2025, according to a draft amendment to the Law on Tax Administration.

Finance - Wed, November 20, 2024 | 5:37 pm GMT+7

Flexibility, adaptability key to effective leadership: PepsiCo Vietnam exec

Flexibility, adaptability key to effective leadership: PepsiCo Vietnam exec

In a rapidly changing world, leaders need to develop the skill of being “as flexible as seaweed,” says Nguyen Viet Ha, general director of PepsiCo Foods Vietnam.

Companies - Wed, November 20, 2024 | 3:52 pm GMT+7

Central Vietnam province okays $88 mln automobile part project

Central Vietnam province okays $88 mln automobile part project

Binh Thuan province's industrial zone authority on Tuesday granted an investment registration certificate to a $88 million project invested by Taiwan’s NeoSCM Limited.

Industries - Wed, November 20, 2024 | 3:44 pm GMT+7

Thai packaging firm Thantawan Industry makes inroad into Vietnam

Thai packaging firm Thantawan Industry makes inroad into Vietnam

Thantawan Industry Public Company Limited, a leading Thai manufacturer of premium plastic packaging, has inked a deal for a 30-year factory lease, marking its inaugural investment in Vietnam.

Industries - Wed, November 20, 2024 | 3:34 pm GMT+7

Developer Novaland gets legal hassles cleared for satellite urban area bordering HCMC

Developer Novaland gets legal hassles cleared for satellite urban area bordering HCMC

Major property developer Novoland has had legal obstacles for its Aqua City project cleared after Dong Nai Chairman Vo Tan Duc approved Tuesday a critical adjustment to the southern province’s urban development plan.

Companies - Wed, November 20, 2024 | 2:29 pm GMT+7

Pegatron to quadruple workforce at $800 mln project in Vietnam

Pegatron to quadruple workforce at $800 mln project in Vietnam

Pegatron Vietnam, a subsidiary of Taiwanese electronics manufacturer Pegatron Corporation, is set to soon quadruple the company's workforce for its $800-million project in Vietnam.

Industries - Wed, November 20, 2024 | 2:03 pm GMT+7

Thailand’s WHA greenlighted to invest $55 mln in central Vietnam industrial park

Thailand’s WHA greenlighted to invest $55 mln in central Vietnam industrial park

WHA Group, a leading Thai provider of fully integrated logistics and industrial facilities solutions, has secured in-principle approval from the Vietnamese government to invest in an industrial park in central Vietnam.

Industrial real estate - Wed, November 20, 2024 | 12:01 pm GMT+7

Indonesia, Brazil sign cooperation deals worth $2.65 bln

Indonesia, Brazil sign cooperation deals worth $2.65 bln

Indonesia and Brazil on Monday sealed cooperation agreements worth $2.65 billion in the areas of renewable energy, sustainable agriculture and technology at the Indonesia-Brazil Business Forum held in Rio De Janeiro, Brazil, on the sidelines of the G20 Summit.

Southeast Asia - Wed, November 20, 2024 | 11:57 am GMT+7

Nusantara not yet feasible as Indonesia’s capital city: authorities

Nusantara not yet feasible as Indonesia’s capital city: authorities

Indonesian Minister of Home Affairs Tito Karnavian said Jakarta still holds the capital status despite the enactment of State Capital Law No. 3 of 2022, adding that the capital city will officially be relocated after the president issues a presidential decree.

Southeast Asia - Wed, November 20, 2024 | 11:55 am GMT+7

Malaysia’s Halal industry to make up 10.8% of GDP by 2030

Malaysia’s Halal industry to make up 10.8% of GDP by 2030

Malaysia’s Halal industry is projected to account for 10.8% of the country's GDP by 2030, with an estimated value of RM231.1 billion ($51.7 billion).

Southeast Asia - Wed, November 20, 2024 | 11:48 am GMT+7

Thailand takes more fiscal measures to sustain growth momentum

Thailand takes more fiscal measures to sustain growth momentum

The Thai government is working on a raft of fresh fiscal measures to sustain an economic recovery, foster new foreign investment, and lower the near-record household debt, says Thai Prime Minister Paetongtarn Shinawatra's top aide.

Southeast Asia - Wed, November 20, 2024 | 11:46 am GMT+7

Indonesia named world's most generous country in 2024

Indonesia named world's most generous country in 2024

Indonesia has been the world's most generous country for the seventh consecutive year since 2017, reported local weekly magazine Tempo.

Southeast Asia - Wed, November 20, 2024 | 11:41 am GMT+7

Work begins on Mitsubishi Estate’s $55 mln logistics facility in northern Vietnam

Work begins on Mitsubishi Estate’s $55 mln logistics facility in northern Vietnam

Logistics facility brand Logicross, under Japan’s Mitsubishi Estate, kicked off the construction of its Logicross Hai Phong ready-built warehouse in Vietnam’s northern city of Hai Phong on Tuesday.

Industrial real estate - Wed, November 20, 2024 | 10:58 am GMT+7