Masan Group Corporation (HOSE: MSN) and SK Group have announced the signing of definitive agreements to acquire secondary shares of The CrownX (TCX) for a total cash consideration of US$345 million, of which $340 million will be from the Korean conglomerate.
After the transaction, the Vietnamese giant will own 85 per cent and SK will own 4.9 per cent in The CrownX, with the former potentially increasing its stake in TCX further in the near future.
After successfully turning around WinCommerce (WCM) and delivering its first profitable quarter in Q3, Masan will shift its priority towards scaling up TCX’s mini-mall ‘Point of Life’ concept – a combination of WinMart+ (grocery), Phuc Long Kiosk (coffee and tea), Pharmacy, Techcombank, and startup mobile virtual network operator Mobicast Joint Stock Company -- into an integrated loyalty offering.
The mini-mall has already yielded results as demonstrated by higher footfall and profitability.
The management is drafting a medium-term game plan to freshly expand the network nationwide, while maintaining profitability with the following key performance indicators: drive the private label portfolio to comprise 20-25 per cent of modern retail sales, grow online grocery to comprise more than 5 per cent of total revenues or 50,000 orders per day, partner with 2,000-3,000 of Masan Consumer Holdings’ general trade retailers for WCM franchising, and develop a loyalty programme and payments system via mobile wallets to drive consumer lifetime value and keep consumer acquisition cost low.
Danny Le, Chief Executive Officer of Masan Group, said: “SK’s investment is a validation of our mini-mall concept as a winning nationwide model that will bring more value to consumers’ daily lives. The next quantum leap for our platform is driving our loyalty platform and digitising our offerings from products to services to win consumer mindshare whether off or online.”
Woncheol Park, representative director of SK South East Asia Investment, said: “We stand fully behind Masan Group. We believe its growth strategy to roll out the mini-mall concept and to build a consumer platform will reap a tremendous outcome for everyone involved.”
The transaction is subject to customary corporate approvals, and Masan aims to wrap up its capital raising round of $200-300 million for TCX by the end of the year.
Credit Suisse (Singapore) Limited acted as exclusive financial advisor to Masan Group.
SK Group is one of the largest corporate groups in South Korea, with interests in energy, chemicals, telecommunications, semiconductors, logistics, and services.
It operates globally in over 40 countries and had consolidated revenues of $86 billion in 2019.
Masan Group’s subsidiaries and associates are industry leaders in branded fast moving consumer goods, branded meat, modern retail, F&B retail, financial services, telecommunications, and value-add chemical processing, all segments of Vietnam’s economy that are experiencing the most transformational growth. — VNS