Vingroup and Masan Jointly Creates the New Retail Group

Diep Nguyen

17:27 03/12/2019

BizLIVE -

This deal is to maximize the strengths of each group so that to create the new big group operating in consumer goods and holds the strength to compete with other big retail groups in Vietnam.

Vingroup and Masan Jointly Creates the New Retail Group
The two behemoths of Vietnam including Vingroup and Masan today released abou the share exchange of VinCommerce and VinEco. This deal is to maximize the strengths of each group so that to create the new big group operating in consumer goods and holds the strength to compete with other big retail groups in Vietnam.
Accordingly, VinCommerce (retail), VinEco (agriculture) and Masan Consumer Company (retail) will merge to create new retail and consumer goods group. Masan has the higher rates of ownership and thus will hold the control right, Vingroup is the shareholder.
This is not the first time that Masan steps into the retail market. Approximately about 2 decades ago in 2001, Masan launched the opening ceremony of more than 25 convenience stores Masan Marts in Ho Chi Minh city in a project which was world VND 75 billion.
The Masan marts at that time spread through all the urban areas and was considered to be the new retail model with rich variety of goods, operating from 6 am to 10pm. This was the network of stores managed by professional staffs and managers.
However, time did not come ripe for the model of Masan marts. Masan did not succeed because the new model was not warmly welcomed by the consumers. Just less than 1 year after the grand opening, all those stores were cloed because of high operating costs but disappointing retail revenue. Masan leaders had to admit that this was not the right time to enter the retail market.
After that failure, Masan centered all efforts on other strengths including fast consumer goods like coffee, energy drinks or fish sauces, etc. Masan gained many successes in fast retail consumer goods and Masan products were gradually accepted by Vietnamese consumers. According to Masan’s own calculation, 98% of Vietnamese at least one time becomes users of Masan products.
According to the new article released by DealStreet today, the new company, which aims to be the country’s leading consumer and retail corporation, will own a network of more than 2,600 supermarkets, a chain of VinMart and VinMart + stores in 50 provinces and cities with millions of customers along with a system of 14 high-tech farms of VinEco.
Since its inception, VinCommerce has continued to expand its presence by increasing the number of stores, as well as the acquisition of supermarkets and convenience stores. The company completed the acquisition of the entire Fivimart chain of 23 supermarkets from Nhat Nam Joint Stock Company. In April this year, VinMart also acquired a chain of 87 Shop & Go-branded convenient stores.

DIEP NGUYEN

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