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Pharmaceuticals

SK Group mulls investing $100 mn in Vietnam's Pharmacity

SK Group has invested about $2 bn in Vietnam's leading companies since 2018

By Jun 21, 2021 (Gmt+09:00)

(Courtesy of Pharmacity)
(Courtesy of Pharmacity)

SK Group is in the final stages of negotiations to invest $100 million in Vietnam's largest pharmacy chain, Pharmacity, as part of the South Korean conglomerate's efforts to tap into the fast-growing retail and healthcare markets in Southeast Asia.

SK Group, South Korea's third-largest business group, is now reviewing detailed terms of an investment in Pharmacity, according to investment banking sources.

"We are studying several business investments in Vietnam, including in the healthcare sector," said an SK Group official on June 18. "Pharmacity is one of our investment options, but nothing has been determined."

Pharmacity, established in 2011, runs 500 stores across Vietnam. Last year, it announced a plan to double its stores to 1,000 by the end of 2021 after raising about $30 million from an unidentified private equity firm.

SK Southeast Asia Investment Ltd. will likely spearhead the potential investment in Pharmacity, the sources added.

The investment arm of SK Group has spent about $2 billion in buying stakes in Vietnam's leading companies since its inception in 2018, including the $410 million purchase of a 16.3% stake in Vincommerce, Vietnam’s top retail business operator, in April of this year. After the purchase, SK Group's ownership in the retail arm of Masan Group has increased to 29.2%.

SK Southeast Asia Investment was established as a joint venture of five SK Group units -- SK Holdings Co., SK E&S Co., SK Hynix Inc., SK Telecom Co. and SK Innovation Co. Each of the five units has put $200 million into the JV. 

The JV had acquired a 9.5% stake in VIetnam's top food and beverage company Masan Group for $470 million in 2018 and a 6.1% stake in Vingroup, Vietnam's largest conglomerate, for $1 billion in 2019.

Last year, the investment venture increased its stake in Imexpharm Corp, a Vietnamese pharmaceutical manufacturing company, to 29.2%.

SK Group has been accelerating its efforts to expand into new growth drivers, leveraging its assets to raise fresh money and finance new investments. 

SK Energy Co., wholly owned by SK Innovation, is selling the land and buildings of its 115 gas stations in the country next month to a domestic real estate management company to raise 764 billion won ($670 million), the company said in a regulatory filing last week. 

Write to Jun-ho Cha at chacha@hankyung.com

Yeonhee Kim edited this article.

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