Hanoi (VNA) -  Information and communication technology groupFPT Corporation has sold six million shares or 30 percent of its stake in FPTDigital Retail JSC to funds managed by and associated with Dragon Capital andVinaCapital.

The deal completes the first stage of FPT’s plan to divest from its retail arm,FPT Retail, reducing its ownership to 55 percent from the previous 85 percent.

The value of the deal was not revealed by either FPT or the two funds. FPT willstill keep control over its retail unit with a post-sale 55 percent stake, andthe income from the deal may not be recorded in the group’s third-quarterearnings report.

In the second stage of the divestment plan, FPT could sell an additional 10percent stake in FPT Retail to other investors via an initial public offering(IPO), HCM City Securities (HSC) had said in a report in July. The second stageis to be completed by the end of 2017.

At the group’s annual shareholder meeting held in April, FPT Chairman TruongGia Binh had said that selling the distribution and retail arm was a must sothat FPT could become a pure ICT group with rapid growth.

Andy Ho, chief investment officer of VinaCapital and managing director of theVietnam Opportunity Fund, was quoted in the FPT’s press release on Friday assaying “This transaction enables us to make a meaningful investment in apremier, unlisted company.”
“The consumer sector is one of our favourites,and Vietnamese people have shown a huge appetite for mobile phones andaccessories, which is their primary tool to communicate and access theInternet,” he said.

With a population of nearly 100 million people and annual retail revenues of 110 billion USD, Vietnam’s consumer market is among the most lucrative retailmarkets worldwide and the retailing of mobile phones and technology gadgets hasposted impressive growth, said Vu Huu Dien, portfolio manager of VietnamEnterprise Investment Limited (VEIL) under Dragon Capital.

“FPT Retail, despite not being in the market for long, has demonstrated itselfas a leading retailer. We highly value the professionalism of the management atFPT Retail, as well as FPT Corporation’s corporate governance and operation,which serve as a firm foundation for FPT Retail’s future robust success inVietnam’s retail market,” Dien said.

FPT Retail is one of the leading retailers in Vietnam. It was operating 438stores nationwide as of July 2017. In the first six months of 2017, it earnednearly 6.2 trillion VND (275.5 million USD) in revenue, up 31 percent year onyear, and 141 billion VND in pre-tax profits, up 44 percent year on year.

For 2017, FPT Retail has set growth target of 27.5 percent and 40 percent inrevenue and pre-tax profits, respectively, by increasing sales in existingstores and opening new ones in areas where smart phone penetration is low atpresent. The company said e-commerce and an omni-channel approach will be usedto reach the business targets.-VNA