The Strategic Shareholder Profile of Tasco Auto: Unveiling the Investment Journey of One of Japan’s Top 7 Trading Conglomerates, Pouring Hundreds of Millions of Dollars into the Lô B Gas Project and Other Prominent Ventures

On August 16, 2024, Tasco Joint Stock Company and Japanese conglomerate Mitsui & Co. announced that they had finalized an agreement for Mitsui to become a strategic shareholder of Tasco Auto – a subsidiary of Tasco, currently the largest automobile distributor and retailer in Vietnam. The investment was disbursed in phases, with the first phase completed on July 31, 2024.

Mitsui & Co. will accompany Tasco Auto in implementing numerous plans and development strategies for the upcoming period. The business field and transportation service business (Mobility Unit) is currently one of the key segments that the group is operating, along with mining, energy – oil and gas, iron and steel, and food…

The participation in numerous different business fields is a characteristic of a long-established Japanese multi-industry enterprise group known as sogo shosha – the general trading conglomerates. According to Wikipedia, there are 7 main sogo shosha, with Mitsui & Co. being the second-largest conglomerate in terms of scale, followed by Mitsubishi, and other familiar names such as Itochu, Sumitomo, and Marubeni…

The characteristic of multi-field business is reflected in Mitsui & Co.’s presence in 125 offices across 61 countries/territories with more than 53,600 employees. In the fiscal year ended March 31, 2024, the group had a total of nearly 500 subsidiaries and invested companies with total assets of $112 billion, revenue of $88.2 billion, and profits of $7 billion, ROE 15.3%.

Mitsui & Co.’s investment activities focus on seeking, developing, and expanding its business through global partnerships with trusted partners, including leading global companies, combining geographic and industry strengths to create long-term sustainable value, and promoting growth and development for stakeholders.

Mitsui has set out three main strategic pillars for its Mid-term Management Plan, including: supporting the development and evolution of industries by providing stable resources and materials, infrastructure; promoting the global transition to renewable energy and low-carbon energy; and improving the quality of life for people by providing quality healthcare services and access to good nutrition.

This tradition of multi-sector investment is evident in its investment portfolio in Vietnam: Before Tasco Auto, Mitsui & Co. invested in Minh Phu Seafood with a 35% stake, Vat Gia (now VNP Group), and established MVC & Co. (MVC) providing design and construction services. housing, by gathering construction material suppliers and related services on the same online platform.

The most notable is the Block B – O Mon Gas Project, in which, at the end of March 2024, a subsidiary of Mitsui & Co., Mitsui Oil Exploration Co. (MOECO), announced that it would invest $560 million in this key electricity-gas project chain.

The investment value of Mitsui in Tasco Auto has not been disclosed, but with Tasco Auto being the largest enterprise in the industry in the field of distribution as well as the plans that both parties intend to implement, this will surely be one of the most notable deals of the year. Not only stopping at car distribution, Tasco Auto recently also shared plans to move upstream with a car assembly plant project (CKD) with a partner in the top 10 global OEM manufacturers – this is a segment that Mitsui has a lot of experience in right in the Southeast Asian region.

Mobility Industry: From Automobiles to Marine, Aviation, and Railways

Mobility is one of Mitsui’s key development focuses mentioned in its mid-term plan. This segment is present in over 60 countries and territories with more than 110 member companies, with business fields ranging from automobile sales, machinery, and mining – railway equipment. In the fields of maritime, aviation, aerospace, and railways, Mitsui & Co. promotes the development of environmentally friendly transportation infrastructure.

Currently, Mitsui divides the Mobility segment into three main markets:

North America: Mitsui is the strategic partner of Penske, one of the world’s largest automobile distribution groups with more than 3,200 branches and 30 car brands. Mitsui has also invested in PAG – a subsidiary specializing in automobile retail distribution of Penske since 2001 and continues to build the Penske Truck Leasing (PTL) joint venture, leasing trucks in 2015, helping Mitsui penetrate the global service chain. rental, transportation, and logistics.

Central and South America (Chile): In Central and South America, Mitsui aims to create stronger business clusters through collaboration between existing businesses and cooperation in new fields. In 2018, Mitsui invested in Mitta, a fleet management company.

Asia and Southeast Asia: In this region, Mitsui & Co. currently holds the automotive supply chain from production, retail to after-sales services, transportation, and logistics. In Malaysia, through its subsidiary Daihatsu Malaysia, Mitsui & Co. is a major shareholder of the country’s largest domestic car manufacturer, Perodua. In the Philippines, Mitsui & Co. has entered the market early on, with the establishment of the Toyota Motor Philippines joint venture with GT Capital Holdings and Toyota Motor Corporation since 1988. Mitsui & Co. also established JBA – a car auction company in the Philippines, together with USS, Japan’s largest car auction company.