Fast-growing e-commerce market spurs M&A deals

14:00 | 08/08/2018
Foreign investors increasingly acquire stakes in and form joint ventures with Vietnam’s e-commerce companies, spurring mergers and acquisitions in the country’s burgeoning e-commerce market.
fast growing e commerce market spurs ma deals

At the beginning of 2018, Chinese online retailer announced its strategic investment in Tiki, Vietnam’s leading B2C e-commerce platform. signed a share subscription agreement as co-lead investor in Tiki’s recent Series C financing round. Upon completion of this investment, will become one of Tiki’s largest shareholders.

Under the plan, will partner with Tiki in a range of areas including merchandising, cross-border trade, logistics and fulfillment, technology, financing, and operational capabilities. The two companies will also co-operate to deliver a wider selection of global brands to consumers, while assisting in the international expansion of Vietnamese brands via’s global platforms.

Meanwhile, Chinese e-commerce giant Alibaba recently injected a further $2 billion into Lazada Group, boosting its total investment to $4 billion. Lazada will become Alibaba’s main vehicle for expansion into the Southeast Asian consumer market.

After six years in Vietnam, Lazada in Vietnam has reported growth figures doubling year-on-year, with about 30 million visits a month, four large warehouses, and 43 distribution centres nationwide.

In April this year, Japanese e-commerce player Scroll Corporation also completed the purchase of a 26.9 per cent stake in Cat Dong Trade and Services JSC, which runs e-commerce websites,, and The two companies will supply solutions in e-trading, logistics, warehousing, and business expansion. Cat Dong will sell Japanese products and tours to Japan, provided by Scroll on its websites.

In 2017, Norwegian telecom group Telenor acquired Cho Tot, marking a deeper foray into Vietnam’s online retail market. Cho Tot is currently the leading online marketplace in Vietnam with more than one billion page views per month. Cho Tot has recorded strong performance, with 3.3 million successful transactions in 2017, up 34 per cent from 2.8 million in 2016.

Ralf Matthaes, managing director of Infocus Mekong, told VIR that the role of foreign companies investing in the e-commerce space is mainly about bringing in technology, marketing know-how, and, above all, a better logistics roadmap than what is currently available in the country.

Fabrice Carrasco, strategic initiatives regional director of Kantar Worldpanel Asia, said that foreign investors are very interested in e-commerce, as it is the quickest way to penetrate a young, dynamic, and fast-growing consumer goods market. Foreign investors want to secure a firmer foothold in Vietnam to clinch the first-entry advantage.

Vietnam’s e-commerce market is still in the early stages of its development, and thus requires big players to bring in knowledge, know-how, and e-commerce expertise. The fastest way for foreign investors to enter the local e-commerce market is via mergers and acquisitions (M&A).

“The appearance of foreign players with loftier expectations will help further develop the e-commerce market in Vietnam,” said Carrasco. “As a result, the e-commerce landscape will be much more competitive and more M&A will occur, consolidating the market.”

Carrasco noted that M&A also offer another touch point for the multi-channel strategy of both retailers and producers. For example, Thailand’s Central Group acquired 49 per cent of shares in the traditional electronics retailer Nguyen Kim. The joint venture then acquired the e-commerce platform Zalora to enlarge its market share in online retail.

By Thanh Van

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