International Finance Corporation (IFC) Announces $38 Million Investment in Dai Dung Corporation
The International Finance Corporation (IFC), a member of the World Bank Group, has unveiled a significant investment plan of up to VND 1,000 billion (approximately USD 38 million) in Dai Dung Construction and Mechanical Corporation (DDC, Dai Dung Group). This investment aims to support DDC’s expansion strategy through the construction of two new state-of-the-art manufacturing facilities, with a total project investment of USD 152 million.
IFC’s Investment Structure: A Quasi-Equity Approach
The IFC’s investment will be structured as a quasi-equity investment, a hybrid financial instrument that combines elements of both debt and equity. This structure allows IFC to participate in the company’s profits based on its performance, while providing DDC with greater flexibility in repayment compared to traditional bank loans. This approach underscores IFC’s long-term confidence in DDC’s growth prospects.
DDC’s USD 152 million expansion plan focuses on the development of two high-tech manufacturing plants in Thanh Hoa and Ho Chi Minh City (within the former Ba Ria – Vung Tau area).
Notably, both projects are designed to meet the LEED Gold green building standards, a key consideration for sustainable investment.
Image: DDC
The Thanh Hoa project, known as the Nghi Son High-Tech Mechanical Factory, spans 45 hectares with an initial capacity of 73,000 tons per year. This facility will specialize in high-precision products for the renewable energy sector (wind power, LNG), heavy industry, and super-sized structures for offshore projects.
Image: DDC
The Vung Tau High-Tech Mechanical Factory, located in Dong Xuyen Industrial Park, covers 10 hectares with a capacity of 87,000 tons per year. This plant will focus on components for offshore renewable energy, including Monopiles and Jackets, as well as equipment for the oil and gas, port, and shipbuilding/repair industries.
The investment in these two specialized facilities highlights DDC’s strategic positioning to capitalize on the shifting supply chain dynamics, particularly in renewable energy and heavy industry. The proximity of both plants to deep-sea ports further enhances their export potential.
Dai Dung is a seasoned player in the steel structure industry, having supplied steel structures for international projects such as the 2022 World Cup Stadium in Qatar and the Misk Ilmi Museum in Saudi Arabia, as well as domestic landmarks like the Hanoi National Exhibition Center, Long Thanh Airport, and the Hoa Phat Dung Quat Complex.
The IFC’s investment is not merely financial. As a member of the World Bank Group, IFC’s endorsement serves as a testament to DDC’s governance capabilities and its commitment to environmental and social standards. This development follows DDC’s recent capital increase to VND 1,753 billion in August 2024 and its ambitious targets of VND 9,000 billion in revenue for the 2024-2025 fiscal year, along with plans for an IPO in 2026.
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