South Korea's SK Group becomes Masan's largest foreign shareholder

South Korea's SK Group becomes Masan's largest foreign shareholder

South Korean`s third largest conglomerate will now hold 9.5% stake of Masan Group, which is valued at about US$5 billion.

Masan Group Corporation (MSN), one of Vietnam's largest privately-run conglomerates, on October 2 announced the completion of SK Group's purchase of 110 million treasury shares, thus becoming its largest foreign shareholder.

At VND100,000 (US$4.31) per share, the deal is reportedly worth US$470 million, for which SK Group, South Korean's third largest conglomerate, will now hold a 9.5% stake of Masan Group.

A previous statement stated the cooperation will enable both parties to draw on each other's strengths to accelerate Masan's and SK's respective growth strategies. The corporate groups aim to jointly pursue transformational business opportunities in Vietnam and to synergize existing business units.

Woncheol Park, representative director of Southeast Asia Investment for SK Group, stated that Vietnam is an "important foundation" for the group's Southeast Asia strategy.  

With a strong balance sheet, Masan said it would add up to US$50 million of net earnings per annum for full year 2019. Management expected core net profit after tax to jump by at least 50% for the fiscal year of 2018 and forecast similar base case earnings growth momentum for 2019 as each of its core business continues to deliver on its growth plans.

Masan plans to consolidate cash at the group level by up-streaming free cash flows from its subsidiaries to build a strategic investment war chest and/or return capital to shareholders. The company does not intend to issue additional shares to investors over the next three years.

SK Group is one of the largest corporate groups in South Korea, with businesses across energy, chemicals, telecommunications, semiconductors, logistics and service sectors. SK Group operates globally across over 40 countries and had a combined revenue of US$141 billion as of year-end 2017.

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