Net Detergent JSC’s factory. Masan HPC has made an offer to buy 60 per cent of Net Detergent JSC. — Photo courtesy of Masan
Masan Consumer Corporation (HNX-UPCoM: MCH) said on December 24 that Masan HPC, a newly established home and personal care subsidiary, has made an offer to buy up to 60 per cent stakes in Net Detergent JSC at a price of VND48,000 (US$2.06) per share, valuing it at $46 million and a price-earnings multiple of 19x.
The deal aligns with Masan’s five-year strategic plan to broaden its product portfolio to better serve the 100 million Vietnamese consumers.
The home and personal care market is one of the largest and most attractive consumer sectors in Viet Nam with a market size of $3.1 billion and fast-growing opportunities to build Vietnamese power brands.
NET is a strategic entry point for Masan to build a diversified home and personal care platform.
NETCO, established in 1968, is a leading local home care business. In 2018 it reported net revenues of VND1.12 trillion ($48.1 million) and net profit after tax of VND57 billion ($2.45 million), primarily driven by its two popular laundry detergent brands, NET and NETSOFT.
Its market share in the detergent segment is 1.5 per cent, and thus trails Unilever (54.9 per cent), Procter and Gamble (16 per cent), Dai Viet Huong (11.6 per cent), LIX (2.7 per cent), and Vico (2.4 per cent), according to a Euromonitor report.
Masan plans to work alongside NETCO to unlock potential synergies and drive double digit top line and bottom line growth since there is high existing overlap with Masan’s current 300,000 points of sales.
Truong Cong Thang, chairman and CEO of Masan Consumer Corporation, said: “We believe the home and personal care sector is still in the early stages of growth when compared to other developed markets.
“Masan Consumer, together with other local companies, is confident that we are best positioned to develop winning value-added innovations and aspirational brands.
“Everything we do is with the end in mind – to uplift the material and spiritual lives of 100 million Vietnamese consumers each and every day.”
The transaction is subject to customary regulatory and corporate approvals and is expected to be completed within two months in accordance with tender offer regulations.
Masan Consumer Corporation, a subsidiary of Masan Group Corporation, is one of Viet Nam’s largest branded food and beverage companies with market leadership in large consumer categories such as seasonings, convenience food, and beverages.
Masan Consumer Corporation’s portfolio includes brands such as Chin-su, Nam Ngu, Tam Thai Tu, Omachi, Kokomi, Vinacafe, Wake-Up, Wake-Up 247, Vivant, Vinh Hao, and Quang Hanh. — VNS