Bain Capital, a U.S.-headquartered investment firm, will invest $200 million in equity capital with Vietnamese conglomerate Masan Group, and plans to up this to $500 million.
Masan, listed on the Ho Chi Minh Stock Exchange (HoSE) as MSN, announced the investment Monday. MSN will utilize the proceeds from the transaction to strengthen its financial position and de-lever its balance sheet, the group said.
The transaction is an equity investment in the form of convertible dividend preference shares (CDPS) to be issued at the price of VND85,000 ($3.49) per share, which could be converted to ordinary shares at a 1:1 conversion ratio.
MSN expects the transaction to close by end-2023 and it will explore other options for equity capital, including diluting its interest in non-core businesses, in a move to bolster its liquidity profile and achieve a sustainable net debt to earnings before interest, taxes, depreciation and amortization (EBITDA) ratio below 3.5 on a steady-state basis.
The transaction also marks Bain Capital’s first-ever investment in Vietnam and underscores the firm’s confidence in MSN’s ability to fulfil Vietnam’s huge market with a population of 100 million, Masan said.
Bain Capital’s partnership is a strong validation of all the consumer-centric investments that MSN has made in the last 18 months to win over 80% of consumer wallet, said MSN CEO Danny Le.
“We look forward to working with Bain to accelerate our vision to be the one-stop shop for consumers’ daily needs,” the executive added.
Masan is a leading business in Vietnam's consumer market. It has been transforming itself from a pure branded products company into an integrated consumer-retail platform to consolidate growth potential across the consumer value chain.
Masan's Win Membership, a platform connecting the brand and consumers, has reached 7 million members. It aims to increase this number to 10 million by the end of this year and 30 million by 2025.
The group recorded revenues of VND37.32 trillion ($1.57 billion) in the first half of 2023, up 3.6% year-on-year. Its gross profit reached VND10.41 trillion ($439.46 million), up 3.6% year-on-year, while profit after taxes after minority interests (NPAT Pre-MI) fell 72.1% year-on-year to VND868 billion ($36.63 million).