The investment management company Mekong Capital said last week that one of its funds will invest up to 6.25mio US$ in a manufacturing company in Vietnam.
The Mekong Enterprise Fund II, a private equity fund launched in June 2006, has already made an initial investment of 1.9mio US$ in Ngo Han Joint Stock Company, which is one of the largest manufacturers of magnet wire in Vietnam.The fund expected to invest more after the Vietnamese law on the 30 percent limit on foreign ownership in unlisted companies has been clarified. This is an ongoing relationship for Mekong Capital. Its original fund, Mekong Enterprise Fund Ltd, which it launched in 2002, originally invested $1.85 million in Ngo Han in early 2004.
“Since our first fund invested in Ngo Han in early 2004, Ngo Han’s revenues have grown at 57% per year over those three years, while their net profit has grown at a rate of 60% per year over those same three years,” the report quoted Chris Freund, Managing Director of Mekong Capital, as saying.He said Mekong Capital expected the strong growth to continue, especially as the company continued “to expand capacity and strengthen its management team.”
Ngo Han, which employs around 200 people and is located in southern Dong Nai province, is expected to have achieved over $35 million in revenue in 2006 in an industry that may not seem all that glamorous.
Its CEO Nguyen Tien said Mekong Enterprise Fund II’s investment “affirmed the long term relationship and support to the company for the great mutual benefit in the future.”
Ngo Thi Thong, the co-founder and Chairwoman of Ngo Han, expected the investment would prepare the company for a “successful listing.”
The $50 million Mekong Enterprise Fund II is a private equity fund focusing on equity investments in unlisted companies in Vietnam, which at the time of the original investment, are typically about two-to-four years away from a listing on one of Vietnam’s stock exchanges.
Ngo Han is the second investment of Mekong Enterprise Fund II. The previous investment made by the fund is International Consumption Products Joint Stock Company (ICP), a fast-growing consumer products company which owns several leading brands in Vietnam including X-Men, Dr. Men and OCleen.
Source: Thanh Nien
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