Vietnamese conglomerate Masan Group has confirmed an initial public offering plan for its FMCG subsidiary Masan Consumer Holdings (MCH).
However, Masan CEO Danny Le said during the company’s annual shareholder meeting that MCH might evaluate different options, including fundraising in the private market.
MCH has proposed to its shareholders a plan to move its shares to list on the Ho Chi Minh City Stock Exchange (HOSE) from the Unlisted Public Company Market (UPCoM). UPCoM is an illiquid market, while HOSE is the mainboard exchange.
An IPO and listing are different processes under Vietnamese securities norms.
The Ho Chi Minh City-headquartered firm did not reveal the target price range or offer amount for the IPO as it is still in the consideration stage. MCH is currently over 90%-owned by Masan.
Last week, Bloomberg reported that MCH might seek to raise as much as $1.5 billion in an IPO that could take place early next year. Jefferies Financial Group, Morgan Stanley, and UBS Group AG were reportedly hired to advise the deal.
MCH’s market capitalisation is currently about $4 billion on UPCoM. HSBC Global Research estimated MCH’s fair value at 120 trillion dong ($4.7 billion).
“We don’t think the valuation on UPCoM represents a company that is growing that fast. So we and our advisors are working to unlock the true value [of MCH],” Le told the company’s shareholders.
Masan had earlier contemplated an IPO for The CrownX, its new retail platform housing MCH and WinCommerce, but the group’s CEO said last year that the plan was pushed back due to unfavourable market conditions.
HSBC Global Research analyst Shuo Han Tan said listing MCH would be an “easier sell” thanks to the company’s strong margins, compared to an early-stage business like The CrownX.
MCH also announced its ambition to gain 10-20% sales from international markets through serving 8 billion global consumers going forward.
In Vietnam, the addressable FMCG market for MCH’s products stands at $15 billion, while the total Vietnam FMCG market is $32 billion, Masan shared during its shareholder meeting.
Most recently, Masan closed a $250-million financing from Bain Capital. Masan said it will continue to consider fundraising activities, including private placements.
