CJ poised to boost investment in Vietnam
South Korean conglomerate CJ Group plans to spend an extra US$500 million expanding its Vietnam operations within this year after having poured around US$400 million in the past 20 years.
Movie lovers come to a CGV cinema invested by CJ Group. The group plans to inject an additional US$500 million in Vietnam this year - PHOTO: QUOC HUNG
HCMC - South Korean conglomerate CJ Group plans to spend an extra US$500 million expanding its Vietnam operations within this year after having poured around US$400 million in the past 20 years.
Speaking to local reporters on March 10, Chang Bok Sang, president of CJ Group in Vietnam, said CJ has done good business in the nation with growth averaging out at 26.73% a year in the 2011-2015 period. Therefore, the firm wants to make long-term investment.
CJ has injected much capital into China, the U.S. and Indonesia, but Vietnam holds strong business and investment potential. Therefore, it will boost investment in this market and make it the third largest investment venue by 2020 after South Korea and China, Chang said.
In 2016, CJ plans to invest US$500 million in the country via new projects, or mergers and acquisitions (M&A) deals in culture, food, warehouse agro-aqua-forestry industries. The enterprise has been active in the sectors over the past time.
Regarding M&A investment, Chang said Vietnam offers good investment opportunities but CJ does not want to acquire a majority stake to compete with domestic enterprises. CJ is seeking cooperation for joint development and technology improvement to speed up domestic sales and exports.
Asked about CJ's plan to acquire Vissan shares, Chang said Vissan is a leading food processing company in Vietnam. If CJ becomes a shareholder, it would invest in technology to raise the competitiveness of Vissan products at home and abroad.
Developed countries have strict standards for food safety while CJ is strong in the food and food service industries in Korea and other nations. Therefore, cooperation between Vissan and CJ would help Vissan grow further. CJ now holds a stake of around 4% at the Vietnamese firm, Chang said.
In the media and entertainment sector, the group spent US$73.6 million owning nearly 80% of shares at Megastar, the largest multiplex cinema system in Vietnam, in 2011. Local Vietnamese publisher Phuong Nam Culture Corporation holds the remaining stake of the cinema chain (20%).
In addition, CJ has developed Tour Les Jour bakery chain in HCMC while building food processing and wheat flour factories. The group has four feed factories in Vietnam and plans to build more plants in the coming time.
As a large retailer in South Korea, CJ is looking for a domestic partner to develop a retail chain, Chang said.
CJ entered Vietnam in 1998 and has since forayed into a variety of sectors such as farm produce and aquaculture, bakery, TV shopping, entertainment and media, logistics, feed, film production and real estate.