Masan acquires majority stake in Phuc Long tea chain
In this article (5)
Conglomerate Masan announced Wednesday that it has spent an additional $110 million to increase its ownership in the Phuc Long beverage chain from 20 percent to 51 percent.
“Since Masan’s initial investment, Phuc Long has demonstrated strong synergies with MSN’s Point-of-Life strategy, which can now be accelerated with Phuc Long as a consolidated subsidiary of Masan,” it said in a press release.
Masan first bought a 20 percent stake in Phuc Long in May last year for $15 million. The latest purchase puts the valuation of the tea and coffee chain at $355 million.
Incorporating Phuc Long’s tea kiosks into Masan’s WinMart+ stores nationwide has been part of the conglomerate’s plan since last year as it sought to advance its “point of life” strategy by developing a mini-mall concept that serves a wide array of essential products and services such as groceries, beverage, pharmaceuticals and financial products.
Masan plans to launch 2,000 such mini-malls this year, and Phuc Long is set to contribute up to VND3 trillion ($132 million) to the conglomerate revenues, which hit VND88.6 trillion last year.
Phuc Long was established in 1968 in the Central Highlands province of Lam Dong. The company launched its tea and coffee chain in 2012 with is first store in HCMC.
Questions & Answers
Q.What was the initial investment made by Masan in Phuc Long and when did it occur?
What was the initial investment made by Masan in Phuc Long and when did it occur?
Masan first purchased a 20 percent stake in the Phuc Long beverage chain in May last year. This initial investment amounted to $15 million, according to the conglomerate's previous announcements regarding the acquisition.
Q.What is Masan's 'Point-of-Life' strategy and how does Phuc Long fit into it?
What is Masan's 'Point-of-Life' strategy and how does Phuc Long fit into it?
The 'Point-of-Life' strategy involves developing a mini-mall concept within WinMart+ stores. These mini-malls offer diverse products and services, including groceries, beverages, and pharmaceuticals. Phuc Long's tea kiosks are incorporated into this concept to advance the strategy.
Q.What revenue contribution does Masan expect from Phuc Long this year?
What revenue contribution does Masan expect from Phuc Long this year?
Masan anticipates that Phuc Long will contribute up to VND3 trillion ($132 million) to the conglomerate's total revenues this year. This is part of Masan's broader plan following Phuc Long becoming a consolidated subsidiary.
Q.What was the valuation of Phuc Long following Masan's latest purchase?
What was the valuation of Phuc Long following Masan's latest purchase?
After Masan's most recent acquisition, which increased its ownership to 51 percent, the valuation of the Phuc Long tea and coffee chain was set at $355 million. This reflects the increased stake and Masan's further investment.