Kkr buys 10% of Masan, Vietnam’s largest PE deal

Global private equity firm Kohlberg Kravis Roberts & Co LP has agreed to buy 10% of Vietnam’s Masan Consumer Corp for $159 million, valuing the company at $1.6 billion, the companies said in a joint statement on Wednesday.

KKR’s investment is the largest-ever private equity deal in Vietnam, and comes as increasing competition for assets pushes private equity firms into wider frontier markets around Asia-Pacific.

“This investment demonstrates our strong conviction in the business prospects of Masan Consumer, as well as in Vietnam as a whole,” said Ming Lu of KKR.

The deal comes just a couple of months after U.S. private equity firm Mount Kellet Capital Management invested $100 million in Masan Group’s mining unit, Masan Resources.

Masan has raised about $500 million in private equity capital in the past two years as the conglomerate’s management looks to expand the company into a proxy for Vietnam’s economy.

This is KKR’s fourth investment in Southeast Asia and its first in Vietnam. The deal will reduce Masan Group’s stake in Masan Consumer to 78% from 86.6%.

Masan Consumer is currently the market leader in fish, soya and chili sauce and the country’s second-largest producer of instant branded noodles.

Vietnam has seen a pickup in private equity activity, as investors bet on a consumer boom in the developing country with a youthful population of more than 80 million.

Over the past decade, Vietnam has emerged from the hangover of war to play a central role on Asia’s factory floor, producing everything from footwear to computer parts.

The country also offers the opportunity for early investment in an underdeveloped consumer market with strong growth. The country’s economy grew 6.78% in 2010, exceeding the official growth target – Reuters

Tags: Kohlberg Kravis Roberts & Co LP, Masan Consumer Corp