Central buys 49% stake in Nguyen Kim

Central buys 49% stake in Nguyen Kim

Central Group, Thailand's biggest retail conglomerate, has announced the purchase of 49% of Vietnamese electrical appliance chain Nguyen Kim to hasten its retail expansion in Asean.

Central Group has purchased 49% stake in Vietnam's electrical appliance chain Nguyen Kim.

On Jan 9, Central signed an agreement to buy the stake in Nguyen Kim Trading Joint Stock Co.

The remaining 51% still belongs to Vietnamese shareholders.

Central Group chief executive Tos Chirathivat said the share purchase in a key strategic market was part of Central's international expansion plan.

"Vietnam has huge potential and high purchasing power, as the country has a population of 91 million, more than 60% of them working people," Mr Tos said.

"This makes Vietnam a target market with high growth for investors in the retail sector."

Ho Chi Minh City and the surrounding areas are showing signs of healthy and sustained growth, while household incomes are on the rise.

Moreover, an influx of foreign investors into Vietnam has resulted in strong GDP growth and a positive spending pattern among target consumers in recent years.

"After combining the sales of Central's Power Buy and Nguyen Kim, we'll become a strong market leader in the electrical appliance business in Southeast Asia," said Sa-angtip Amornchat, vice-president for marketing at Power Buy Ltd.

Power Buy posted 18 billion baht in sales last year, while Nguyen Kim had 13 billion baht.

Nguyen Kim has 21 branches in Vietnam, while Power Buy has 90 stores in Thailand.

Central has branched into Vietnam over the past two years. It operates SuperSports, Crocs, New Balance and other fashion brands, with more than 60 stores and counters in the country.

The group also opened Robins Department Stores in Hanoi and Ho Chi Minh City last year.

Central's other investments in Asean include Central Marketing Group's acquisition of a Malaysian fashion distribution company, HCH Industries Sdn Bhd, which has more than 500 branches in the neighbouring country.

In addition, Central Pattana Plc has acquired land near Kuala Lumpur to develop a shopping mall called CentralPlaza i-City in Selangor's capital city of Shah Alam.

Central also launched a department store at Jakarta's Grand Indonesia Shopping Town last year.

Mr Tos said the Central-Nguyen Kim deal would enable Nguyen Kim to continue its expansion in Vietnam and let Power Buy become the top appliance retailer in Asean.

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