Singapore-listed automotive group Jardine Cycle & Carriage has bought a stake in Vinamilk, Vietnam’s largest dairy producer.

The company, part of the Jardine Matheson conglomerate, has snapped up a 5.53% stake for US$616.6m.

The transaction was conducted through Jardine Cycle & Carriage’s wholly-owned subsidiary Platinum Victory Pte, according to a stock exchange announcement today (13 November). The 80,285,671 shares were purchased at VND10,000 (US$0.44) each.

Vietnam’s government is in the process of winding down its stake in Vinamilk, which is held by sovereign investment fund State Capital Investment Corp (SCIC).

Following the recent divestitures, SCIC’s holdings now stand at 36%, a Vinamilk spokesperson confirmed to just-food. Food and drink company Fraser and Neave owns 18.74%, while the remainder are held by fund managers around the world, mainly in Singapore, Hong Kong, the US and UK. 

Jardine Cycle & Carriage said the stake purchase is part of a strategy to invest in “market leading companies” in south-east Asia and gives the company exposure to Vietnam’s economy. “Consideration will be given from time to time to making further such investments,” it said.  

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By GlobalData

Vinamilk is the biggest company in Vietnam by market capitalisation equating to $10.9bn and does business in 43 countries. It operates 13 dairy factories, 10 cow farms and has 240,000 retailers as exclusive distributors. Total revenue amounted to VND46.9bn in 2016, with net profit of VND9.3bn.

The company, which is listed in Ho Chi Minh City, started exporting to China earlier this year.

In March, it took full control of its Cambodian venture Angkor Dairy Products Co., or Angormilk.