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OVERVIEW

1. Background
In the world economic history, M&A has existed for more than 100
years with six major M&A waves in 1900s, 1920s, 1960s, 1980s, 1990s
and 2000s (Kim, 2009). Regarding to the Asia region, the M&A trend
has appeared mid-1980s, and then have dramatically developed as the
Asia financial crisis happened (Mody & Nagashi, 2000).
M&A appeared has just appeared in Vietnam in 1990s and did not
make any bold step in the first ten years and then increased
significantly in the early of 2000s due to the open policy to
international investors. The period from 2003-2013 has seen a
booming growth in M&A transaction and regarded as the first wave of
M&A in Vietnam. Many aspects of this period will be discussed below
to provided an insight in it.
2. A review of 2003-2013 period
The real boost in M&A market occur in 2007 and reached the peak in
2012. The value of M&A transactions increased by 15% to 30%
annually until 2012. In 2007, M&A activities saw its greatest increase in
total transaction values with the growth of 475% and reaching 1.7 USD
billion with 108 transactions. This growth was directly linked to an
important event when Vietnam joint the WTO on 07 November 2006.
Afterward, the 2008-2013 era was mentioned as an golden period for
M&A when the growth rate in this period is 500% and turn Vietnamese
M&A market become an 5 USD billion market in 2013. (Figure 1)

In this period, transactions which occurred between domestic


companies contribute 77% to the successful transaction recorded.
However, almost of them are small scale transaction with 47% of

transactions are under 10 USD million. Regarding to the value of the


transactions, foreign investors exposed to almost big ones with 66% of
the total value of all transactions in 2008-2011. Figure 2 shows the
distribution of transaction based on its value from 2003-2010 (Vuong &
Quan Hoang, 2010).
Figure 2: Distribion of transaction value from 2003-2010 (million of USD)

5%
9%
19%
V<1

1<V<5

5<V<10

10<V<50

33%

50<V<100

V>100

25%
9%

3.

The
M&A
market distribution based on sectors in the last ten year:
Finance, Consumer take the dominance
Financial services sector with banking industry as the core industry is
the most active sector in this period. The re-construction of large
national baking is the force which surge this activity. The merger of
SHB and HABU Bank, the private placement of Vietcombank and
Viettinbank to Japanese investor is outstanding example for this.

Beside financial sector, industry and staples consumer are two big
sectors which accounted a great part in the distribution (figure 3).
Moreover, according to KPMG Vietnam, Singapore; Japan; USA is
respectively the three highest foreign buyer based on buying volume.
Regarding to the value of the transactions, Japan accounted for biggest
buyer, followed by Singapore and USA. In details, Japanese investor
focused on financial sector with big transaction such as the private
placement of Vietcombank to Mizuho or Vietinbank to UFJ Mitsubishi.
On the other hand, Asean investor got attractive to consumption and
materials sector. Table 1 list out the top 10 companies in M&A market
in the last ten years.
Figure 4: Top 10 buyer in terms of volume and value in the last 10 years

Figure 3: Number of transaction by key sector in 2003-2013