Masan consumer - retail platform The CrownX begins new chapter by raising $1.5b from investors
HCM CITY — With marquee global investors in tow and pieces of the puzzle of building a consumer - retail - technology platform gradually falling in place, The CrownX has without doubt entered the acceleration phase.
Masan Group (stock code MSN) has closed the final round of funding for 2021 for The CrownX (TCX), Masan’s integrated consumer-retail platform that consolidates WinCommerce (formerly known as VinCommerce) and Masan Consumer Holdings.
In this funding round, a consortium of investors comprising TPG, the Abu Dhabi Investment Authority (ADIA), and SeaTown Holdings invested US$350 million in it.
In April this year Korea’s SK acquired a 16.26 per cent stake in VinCommerce for a cash consideration of $410 million.
In June a consortium led by Alibaba Group and Baring Private Equity Asia bought a 5.5 per cent stake in newly issued shares in The CrownX for $400 million.
Also in June Masan and The CrownX invested nearly $400 million to acquire TCX shares from minority shareholders.
In November SK Group invested $340 million to acquire a 4.9 per cent stake in The Crown X.
This means a total of $1.5 billion was invested in The CrownX in 2021 though the economy was in the dumps because of the COVID-19 pandemic.
The CrownX not only attracts new strategic investors but also brings added value to existing shareholders through the final round of funding.
With TPG, ADIA and SeaTown buying stakes at $105 per share, TCX saw its valuation rise to $8.2 billion, 12 per cent higher than when the consortium led by Alibaba Group, Baring Private Equity Asia and SK invested in it.
In this fundraising round, The CrownX welcomes new investors SeaTown Holdings, a wholly-owned subsidiary of Temasek Holdings, and ADIA.
Temasek is one of Singapore's two sovereign investment funds along with the Government Investment Corporation (GIC).
It currently has a portfolio of $400 billion under its management, mainly in the Asia region.
With its cautious stance, putting safety first when deciding to invest, it can be seen that Temasek has firm belief in The CrownX’s future prospects, especially its proposed international IPO.
Masan Group CEO Danny Le said after finishing fund raising the group now looks forward to an international IPO for The CrownX in 2023-24.
Funds usually expect their investment to appreciate by at least two or three times in each investment cycle. It is likely that the big boys like Temasek are betting The CrownX's valuation will reach $20 billion in the next two or three years when it goes for an IPO.
The Abu Dhabi Investment Authority has a portfolio of around $649 billion globally under its management.
ADIA is a relatively unknown name in the M&A market in Việt Nam. The CrownX is the first Vietnamese company in which the Middle Eastern investment fund has invested.
ADIA has a portfolio of around $649 billion, the second largest among investment funds in the Middle East.
With their scale increasing rapidly over time, sovereign wealth funds in the Middle East play an increasingly important role in the global financial system.
Middle Eastern countries also use these funds to diversify their income by investing in global assets, reducing their dependence on oil.
TPG is an ‘acquaintance’ that has partnered with Masan for more than a decade.
In 2009 TPG invested in Masan when the consumer goods company was preparing to list on HoSE. At that time, Masan's market capitalisation was only $900 million.
Today Masan Group's valuation exceeds $8 billion and continues to grow. South Korean giant SK has also invested for long in Masan and its subsidiaries.
It seems likely that the recent investment of $350 million is just the first round by ADIA and Temasek, especially in the context that The CrownX's valuation is likely to increase further from now until the IPO in two or three years.
Pieces gradually falling in place
Masan plans to build the tech-enabled consumer-retail ecosystem by leveraging the Reddi telecommunication platform.
Masan stands to benefit from the partnership with the giants not only in terms of financial support but also their experience, a foundation for it to accelerate digital transformation of The CrownX and make it an integrated consumer -retail and technology platform that does business both offline and online.
Before investing in The CrownX, TPG and ADIA has invested $600 million and $750 million in Indian telecommunications company Jio Platforms. It is the largest network operator in the South Asian country with a population of over one billion, and is owned by Reliance Retail, India’s largest retailer.
Interestingly enough, The CrownX has many similarities with Reliance Retail - Jio Platforms. It is clear that TPG and ADIA have seen the potential of the consumer - technology - telecommunications company model.
And in Việt Nam, The CrownX is a pioneer in this, and boasts many factors conducive to rapid growth and to bringing breakthrough values to investors.
WinCommerce, the largest grocery retailer in Việt Nam in terms of outlets, together with Phúc Long, Techcombank and Reddi mobile network can serve almost all the essential needs in consumers' daily life.
By offering a broad array of daily essential products and services under the integrated WinMart+ stores, The CrownX owns a unique integrated offline-to-offline format and a cost-efficient model to win spending share across multiple consumer use cases.
In the near future Masan might leverage Reddi’s loyalty platform to promote cashless payment, buy-now-pay-later services and asset management and investment solutions.
It could also tie up with a fintech partner and carry out data research to perfect its digital ecosystem.
M&A is a tool that Masan usually uses to implement its development strategy. It believes that the next game changer will be developing fintech solutions for mass market consumers. VNS
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