According to information from Reuters, CDH Investments from China is in talks to acquire a minority stake in the Bach Hoa Xanh chain from Mobile World Investment Corporation (MWG). If a deal is reached, the valuation of the Bach Hoa Xanh chain could reach $1.7 billion.
Sources say CDH, one of China’s largest investment companies, has also previously owned shares in Mobile World. The Chinese company has emerged as a leading candidate to acquire up to 10% of Bach Hoa Xanh after surpassing competing bidders.
“CDH Investment intends to acquire between 5% and 10% of Bach Hoa Xanh’s shares,” the source said. Discussions are still ongoing and it is uncertain whether a deal will be made.
According to research, CDH Investment was founded in 2002 by Chairman Wu Sangzhi and is one of China’s first private joint-stock companies, known for its risky investments in traditional industries such as consumer goods and manufacturing. Currently, CDH manages over $27 billion in assets and is a major investor in WH Group – the world’s largest pork supplier, and Midea Group – a home appliances manufacturer.
Many may have forgotten that CDH Investment was once one of the largest shareholders of Mobile World. In mid-March 2013, Mekong Capital and the founders of Mobile World divested nearly 20% of the company’s shares.
The identity of the buyer was disclosed as CDH Electric Bee Limited – a fund affiliated with CDH Investment. Specifically, this investor acquired 2.08 million shares, equivalent to 19.88% of the capital of Mobile World. CDH Electric Bee Limited is a registered investment fund established in the tax haven of the British Virgin Islands.
Upon becoming a major shareholder of Mobile World, the CDH fund appointed Mr. Thomas Lanyi – CEO of CDH Investment Advisory Pte Ltd, as a member of the Board of Directors and also its authorized representative in Mobile World. However, before Mobile World listed shares on HoSE in mid-2014, CDH Electric Bee began divesting from the company.
In the first transaction recorded after Mobile World officially listed in November 2014, CDH Electric Bee only held about 15.8% of the capital. By October 21, 2016, the fund was no longer a major shareholder of the retail company in Vietnam, holding only 3.22% of the capital.
And by February 2018, CDH Electric Bee had completely divested its capital from Mobile World. According to information from Reuters, this investment fund made a profit from investing in MWG. However, it is not possible to calculate exactly how much profit CDH made in the aforementioned deal. However, during the 5 years CDH held MWG shares, the price remained above VND 100,000 per share, allowing the company to earn billions of Vietnamese Dong.
