Vietnam Attracts Investors from Europe, the US, and Japan
There is currently a wave of investors from Europe, Japan, the UK, and the US seeking investment opportunities in Vietnam, according to M&A experts.
Experts from GMAP have assessed that in recent years, Vietnam has successfully attracted investments from various Asian countries such as Japan, South Korea, Singapore, Thailand, and China. Still, it has been lacking investments from Europe and the United States.
However, according to insights shared at the conference by Mr. Ivan Alver, Co-Founder of Global M&A Partners cum Partner and Chairman of Saga Corporate Finance (Norway), there are positive signals from European and American capital due to Vietnam’s stable political environment, growing consumer demand, and competitive labor costs. “Investors are shifting their attention to Asian countries, including Vietnam,” he explained.
According to the Ministry of Planning and Investment, in the first ten months of this year, foreign direct investment (FDI) in Vietnam, including newly registered, adjusted, and capital contribution and share purchases, reached over $25.7 billion, a 14.7% increase compared to the same period last year.
Earlier this year, Japanese and American investors were also involved in notable M&A deals, such as SMBC (Japan) investing $1.5 billion for a 15% stake in VPBank’s private placement or KKR Global Impact (US) investing $120 million in EQuest.
Mr. Frederic De Boer, Co-Chairman of GMAP and Partner at Zetra AG (Switzerland), mentioned that they currently have two manufacturing infrastructure clients with operations in China, and his M&A companies are advising them on investments in Vietnam. “We see European investors being attracted to manufacturing in Vietnam. Some companies have already invested here, and there is potential for more to follow this trend,” he predicted. Recently, a prominent European project is the $1 billion Lego factory in Binh Duong.
Traditional large investors like Japan also favor investing in Vietnam. Mr. Sam Yoshida, Global Director of RECOF, stated that international investors are interested in sectors such as food production, retail, education, non-banking financial technology, and logistics. Japanese investors, in particular, are keen on logistics, especially cold supply chains.
While Vietnam is affected by the global economy, Mr. Sam Yoshida, Global Director of RECOF, believes that the economic situation in Japan has a more significant impact on investors due to the depreciation of the yen and business constraints with shareholders. Therefore, investing overseas, such as in Vietnam, remains a better choice.
To attract more foreign capital into Vietnam, especially through M&A, Mr. Ivan Alver recommended that the policy environment needs to be even more favorable for divestment activities
For businesses looking to sell, a typical M&A deal takes an average of 9 months. Therefore, this expert emphasized that companies should engage an advisor at least a year in advance to have the ability to compare, negotiate for a good price, and find suitable buyers.