After signing the agreement late last year, Dragon Capital has officially held a 13 per cent stake in CEN Land, a member company of CEN Group, a source said.
Founded in 2002, CEN Land is currently prominent in the real estate brokerage market in the north of the country. The company is the pioneer in marketing Vietnam’s real estate to foreign customers.
According to CEN Land, the company distributes over 10 thousand various real estate products every year. Based on the average commission the realtor receives from real estate investors, it is estimated that total revenue of CEN Land in 2017 reached nearly VND1.3 trillion (US$57.2 million).
CEN Land, which has the charter capital of VND500 billion (US$22 million), was valued at US$84 million by Dragon Capital before being invested by Dragon Capital.
Dragon Capital earlier became a strategic shareholder of Hai Phat Investment after signing a contract to purchase a 15 stake in the company.
Hai Phat Investment, a real estate firm, owns many projects in the west of Ha Noi such as The Pride, The Vesta. The company is also developing other large-scale projects such as Roman Plaza, HPC Landmark 105 (acquired from Usilk City project) and Hanoi Homeland.
In addition, Hai Phat Investment owns many other potential projects in provinces and cities of Nha Trang, Da Nang, Hoi An, Binh Thuan, Bac Ninh and Thai Binh. This is one of the important factors to attract investors to invest in a real estate company.
Recently, Hai Phat Investment has increased its charter capital to VND1.2 trillion (US$52.8 million) to develop projects. Do Quy Hai, Chairman of Hai Phat Investment, holds more than 40 per cent of stake in the company.
Investment funds managed by Dragon Capital are interested in real estate sector. These funds have poured hundreds of millions of dollars into IPOs (initial public offering), including IPOs of major real estate companies such as Novaland and Vincom Retail.
According to a document released by Dragon Capital at the end of last year, Dragon Capital will continue to invest in privately-owned and State-owned companies which will conduct IPOs in the incoming time.
Among real estate companies in which Dragon Capital is interested, SonKim Land and MB Land are the two companies planning IPOs in the near future.
As becoming “Asia's new economic tiger”, Vietnam is receiving huge foreign portfolio investment flow. This is evidenced by investment funds’ strong growth in asset size as well as the emergence of new large-scale investment funds.
In addition to Dragon Capital, many asset management companies of South Korea have successfully raised capital and are eyeing to invest in Vietnam’s companies.
This is an opportunity for real estate firms, including small and medium companies, to raise their capital through IPOs and sales of shares to their strategic shareholders instead of being dependent on bank loans.