Alibaba Group Holding Ltd. and Baring Private Equity Asia are investing USD400 million in Vietnamese conglomerate Masan Group Corp.’s retail arm – The CrownX.
The move comes as part of the Chinese e-commerce giant’s efforts to expand into Southeast Asia against the backdrop of tighter scrutiny in China.
The 5.5% stake acquisition in The CrownX gave the company a USD6.9 billion valuation. Once the deal is signed, Masan will retain 80.2% of The CrownX.
The CrownX will also partner with Alibaba’s Southeast Asian ecommerce company Lazada to build a digital presence and accelerate the O2O market in Vietnam. Estimates by Bain & Co., Google and Temasek project Vietnam’s digital economy to grow by USD 52 billion by 2025; an annual increase of 29% from 2020.
“Our immediate priority is to modernize Vietnam’s grocery market and develop an unparalleled consumer proposition from assortment to shopping experience,” said Danny Le, chief executive officer of Masan Group.
Grocery accounts for 50% of Vietnam’s retail market and 25% of consumer wallet share and is of essential daily use, but online penetration is still nascent.
Masan is also in advanced discussions regarding a further strategic investment of USD 300 – 400 million into The CrownX from other investors, expected to close in 2021.
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