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European, American investors keen on M&A transactions in Vietnam
By Hung Le
Thursday,  May 21, 2020,13:33 (GMT+7)

European, American investors keen on M&A transactions in Vietnam

By Hung Le

Representatives of European enterprises participate in a trade promotion exhibition in 2019. Vietnam has seen an increasing number of merger and acquisition transactions this year, especially among investors from European countries and the United States – PHOTO: HUNG LE

HCMC – Vietnam has seen an increasing number of merger and acquisition (M&A) transactions this year, especially among investors from European countries and the United States, according to the Foreign Investment Agency.

The department with the Ministry of Planning and Investment said in a report that American investors were involved in 101 M&A transactions worth over US$68.5 million with Vietnamese firms between January and April this year.

At the same time, the United States had a total of 37 foreign direct investment projects at a total investment of some US$25.5 million in Vietnam. As such, the capital sum was well below the value of the M&A transactions.

European investors also followed this upward trend during the four-month period.

Investors from France made a total of 78 transactions worth some US$27 million. Though the value fell by over US$11 million from a year earlier, the number of deals rose by 37.

Similarly, investors from the United Kingdom, the Netherlands and Germany conducted 32, 15 and 27 transactions, worth some US$38.5 million, US$46 million and US$4.7 million, respectively.

Overall, foreign investments through capital contributions and stake acquisitions in Vietnamese firms came from Asian countries as well as from Europe and the United States.

The Foreign Investment Agency noted that foreign investors had poured some US$2.5 billion into M&A transactions in Vietnam. The sum was equivalent to 34.7% of the year-ago period’s figure, but the number of transactions surged by 33% to over 3,210.

Investors from South Korea took the lead with more than 1,000 transactions, while those from the northern neighbor China ranked second with 557 deals.

However, Japanese investors took first place in terms of capital as they injected US$743 million into 287 M&A transactions.

According to experts, Vietnam is poised to attract foreign investors in the years to come, thanks to its potential.

Also, many Vietnamese firms are suffering the brunt of the novel coronavirus pandemic, so foreign investors have acquired stakes from them at low prices.

Minister of Planning and Investment Nguyen Chi Dung said at a recent conference between the prime minister and the business community that more than 45% of local firms are in desperate need of funds for manufacturing and business operations.

He warned that M&A deals could result in Vietnam’s potential enterprises being acquired at low prices by foreign investors.

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