Matsushita Electronic Industrial Co., Ltd. (MEI) has become the first foreign investor to be granted approval by the Vietnamese government to establish a 100 per cent foreign owned holding company – Panasonic Vietnam Co., Ltd. - in the country on August 3, 2005. Under the pilot holding scheme, Panasonic can integrate its several companies in Vietnam with its international resources.
According to Mr. Nguyen Ngoc Phuc, Vice Minister of the Ministry of Planning and Investment of the Socialist Republic of Vietnam “MEI is the first investor who can establish the 100 per cent foreign own capital holding company in Vietnam. This is attributed to the strong efforts of the Government of Vietnam in order to diversify the types of investment in Vietnam, which is suitable to International Rules.”
Matsushita Electronic Industrial Co., Ltd. (MEI), best known worldwide for its Panasonic brand electronic products, has become the first foreign investor to be granted approval by the Vietnamese government to establish a 100 per cent foreign owned holding company in the country on August 3, 2005. The approval was made as part of a program initiated by the Vietnamese Ministry of Planning and Investment, and the new company, Panasonic Vietnam Co., Ltd. will be established as a wholly owned subsidiary of MEI. The pilot holding company will commence its operation from October this year. Under the pilot holding scheme, Panasonic can market and sell the imported products manufactured by the Panasonic overseas group companies.
To date, Panasonic has been operating two factories, one in Hanoi and the other in Ho Chi Minh City, Panasonic Home Appliances Vietnam Co., Ltd. (PHAV) was established in 2003 in Hanoi, responsible for manufacture and sales of home appliance products, while Panasonic AVC Networks Vietnam Co., Ltd. (PAVCV) was established in Ho Chi Minh in 1996 for manufacture and sales of audio visual products such as color TVs.
In response to the rapid market growth for electronic products in Vietnam, Panasonic has been searching for ways to increases imports and accelerate local production. One solution was to establish a holding company that will effectively place both factories under one umbrella – a concept put forward by Panasonic, and scrutinized by the Vietnamese government until this day.
The establishment of Panasonic Vietnam will enable Panasonic to integrate its existing management resources and thus facilitate optimum allocation of investment in future projects. Panasonic Vietnam will also handle marketing, sales, service and export of locally manufactured products (by PHAV and PAVCV), as well as products imported from other Panasonic manufacturing companies worldwide. Panasonic Vietnam’s marketing and sales of imported finished goods will allow it to expand on the availability of product lineups for the Vietnamese market. With both factories under one management structure, and with reinforced product lineups, Panasonic will further strengthen its integrated marketing activities.
According to MEI’s Corporate Management Division for Asia and Oceania Executive Director Tomio Kawabe, several business units of MEI in Japan headquarters have already expressed interest in introducing new investments into Vietnam. MEI’s ultimate aim is to make Vietnam one of its major production bases in Asia - about a quarter of Asia’s total production by year 2010.
“It is our greatest honor to become the first foreign company to be awarded the approval to establish a wholly owned holding company. We consider this opportunity to be the result of an amicable relationship between the Vietnamese government and Panasonic. Through the establishment of Panasonic Vietnam and strong support from the government, Panasonic hopes to set a new business model in Vietnam, thereby stimulating the local economy. As we consider Vietnam to be a highly attractive country with promising market and rich human resources, we are currently undertaking feasibility studies for several new investment projects to make further contribution to the development of Vietnam.”said Mr. Tomio Kawabe.
The holding company model has been widely adopted by many developed countries to provide flexibility to investors for market expansion as well as business development. This business design model will perform management and shared services and it will help to synergize and integrate domestic businesses with international resources. Such a holding company model will definitely send positive signals to existing and prospective investors for them to consider more investments in Vietnam.
Vietnamese
