Fund managers had achieved 77 full and another 76 partial private equity exits in Vietnam between 2003 and 2010, the foreign-invested accounting and consulting firm Grant Thornton Vietnam said in its recent report released January 18.
The exits had a combined value of more than $1.146 billion as showed in its survey conducted in December last year.
The survey was conducted among the fund managers operating in Vietnam, including Dragon Capital, Indochina Capital, Mekong Capital, Prudential Vietnam, VinaCapital, BankInvest and AIM Capital Management.
The participating fund managers had invested a combined over $1.8 billion in around 200 private companies in Vietnam in the 2003-2010 period.
The year 2007 saw the largest number of investments made, both in value and in number, with $750 million in more than 50 private firms. It was also the peak year for fund managers to divest their investments, with $292 million and 40 transactions done.
The global financial crisis had caused a substantial decrease in both value and volume of private equity investments after 2007, with $197 million and 16 in 2008, $60 million and eight in 2009, and $71 million and eight in 2010.
The declines reflected the constraints in fund-raising in the capital markets, following the global financial crisis and its impact on Vietnam.
The average holding period for each exited investment was three years, and this period tended to be longer over the survey period, with exits in 2010 taking, on average, between four and five years, said Ken Atkinson, managing director of Grant Thornton Vietnam.
Based upon the large number of investments made in 2007, a large number of exist deals are expected to be made in the next two years, Atkinson forecast.
The survey also showed that stock exchange listings had become the most predominant method used by fund managers for their exits, accounting for over 60% of all exits.
Grant Thornton Vietnam said successful exits would enable fund managers to have money for new investments without raising additional capital amid the tightening of capital markets after the financial crisis. (Saigon Times, Vietnam Economic Times)
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