First entertainment investment fund launched in Vietnam

Vietnam Entertainment Fund (VEF) was launched in Ho Chi Minh city with the capitalization of $50 million.

This is an open-end fund operating in the form of holding, which owns other companies’ stock. It was established by Yeah1CMG, R&B Capital Group, Surfing Holdings, MBC Studio, and Green International, under the consultancy of VinaCapital Fund Management (VCFM).

According to the founders, VEF was expected to promote the film industry in Vietnam, broadly support the financing, and standardise film studios in Vietnam.

Meanwhile, through the investments, the fund will maximise profits for investors by increasing the value of capital and dividend yield from the initially-invested assets such as intellectual property or fixed assets.

Regarding the portfolio, it is known that VEF will diversify the invested sectors to reduce risks but still ensure to meet investment objectives. In 2018, VEF plans to gain advertising rights in 26 theatres including Starlight, Beta Cineplex, EVC, Cinebox, Cinestar, etc. It expects to increase this figure to 40 theatres by 2022. On the other hand, investments in cinemas are in the longer term.

Furthermore, VEF also expects to attract businesses and investors with flexible investment, financial transparency, and investor protection.

VEF plans to set a minimum income of eight per cent per year and a maximum one of 10.5 per cent per year for 2018 and 2019. After that, from 2020 to 2022, the minimum income will be 10.5 per cent. There are also other financial benefits to investors such as the right to purchase preferred stock. VEF shares are expected to be on an initial public offering (IPO) after five years of establishment.

Currently, the profitability of Vietnam’s entertainment industry is attributed to its average natural growth, which reached 25 per cent per year, and the average film market, which reached about $99 million per year.