HANOI: Masan Beverage Ltd, part of consumer goods-to-financial services conglomerate Masan Group, will pick 65 per cent stake in Quang Ninh Natural Mineral Water Co Ltd, as part of the latter’s planned equitisation process.
With this, Masan Beverage will become the strategic investor of the mineral water firm upon closing of the initial public offer. Quang Ninh Natural Mineral Water has a strong presence in the north of Vietnam and is known by its Quang Hanh and Faith brands.
“The (investee) company is on track to grow sales by nearly four times in the next five years. In 2015, it is expected to reach an estimated VND370 billion in sales,” Masan Group said, in a statement.
In 2014, mineral water represented the majority of bottled water sales in the Southeast Asian country, and, according to market intelligence firm Euromonitor International, overall bottled water revenue will potentially hit over $460 million by 2017.
Together with Vinh Hao, in which Masan acquired a 64 per cent stake and is understood to be interested in a full takeover, Masan Group expects Quang Ninh Natural Mineral Water will further position its beverage unit as a nationwide platform to become the country’s largest mineral water-based beverage company.
The acquisition is hoped to generate nearly VND1 trillion ($44.6 million) in revenue in 2015, jumping two times year-on-year in terms of the mineral water-based beverage business.
Prior to the steps to strengthen its foothold in the mineral water segment, Masan had acquired 53.2 per cent of Vinacafe Bien Hoa in 2013. The subsidiaries both enjoyed high growth in profit after the first year under the same umbrella of Masan Group.
While Vinacafe Bien Hoa reported a 54 per cent increase to VND401.37 billion in profit after tax in 2014, Vinh Hao’s profit before tax for the first year being a Masan Group unit reportedly grew by a ten fold to VND223 billion.
