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Thiet ke Brochure - Mekong Capital 2007
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Thiet ke Brochure - Mekong Capital 2007 Document Transcript

  • 1. 1
  • 2. ContentsMEKONG CAPITAL 3Overview 4Background 6Active Investor 8Early Stage Investor 9Exceptional Local Team 10Fast Growing Companies 13Investment Strategy 13Disciplined Approach 14Target Industries 16Focus on a Single Business 17OUR FUNDS 19Mekong Enterprise Fund, Ltd 20Mekong Enterprise Fund II, Ltd 23Vietnam Azalea Fund Limited 24HOW WE ADD VALUE 27Types of Assistance Projects 28Recruitment 29Financial Reporting and Management 30Strategy and Expansion Planning 31Process Improvement 33Preparing for Successful Listing 35PORTFOLIO COMPANIES 37AA Corporation 38Duc Thanh Wood Processing 39Goldsun 40International Consumption Products 41Intresco 42Lac Viet Computing 43Minh Hoang Garment 44Minh Phuc Manufacturing and Trading 45Ngo Han Joint Stock Company 46Nam Hoa Production and Trading 47Saigon Gas Holdings 48Tan Dai Hung Plastic 49The Gioi Di Dong - Mobileworld 50 Legal DisclaimerThis document provides summary information aboutMekong Capital, Ltd. (“Mekong Capital”) and funds managed byMekong Capital, and is not intended to be comprehensive. Nounderstanding, representation or warranty or other assurance,express or implied, is made or given by any person to theaccuracy, fairness or completeness of the information or opinionscontained in this presentation and no responsibility or liability isaccepted for any such information or opinions. No recipient ofthis document, including, without limitation, investors or potentialinvestors in any funds managed by Mekong Capital, may rely onthis document in any manner whatsoever. 2
  • 4. Overview Mekong Capital is an employee-owned investment management company which is the investment manager of three Vietnam-focused investment funds: Mekong Enterprise Fund, Ltd. (2002); Mekong Enterprise Fund II, Ltd. (2006); and Vietnam Azalea Fund Limited (2007).4
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  • 6. Background Mekong Capital was established in 2001 by individuals with extensive background in the investment management industry, both in Vietnam and internationally. With a team of 40+ full time people in our offices in Ho Chi Minh City and Hanoi, we have the largest and most experienced private equity team in Vietnam.6
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  • 8. Active Investor Mekong Capital is an active investor which adds significant value to the companies in which our funds invest. In particular, we help companies to expand and strengthen their management teams, make improvements to financial reporting systems, increase operational efficiency, and prepare for successful listings on a stock exchange.8
  • 9. EarlyStage InvestorWe invest in companies at earlierstages than most institutional investorsin Vietnam. While investments in early-stage companies usually require moreeffort than companies which are nearerto listing or which have already beenlisted, our team of 40+ people on theground in Vietnam allows us to deploysignificant resources to implementinvestments which require significanteffort, and to add value to thosecompanies after we invest.We aim to maintain strong relationshipswith other institutional investors active inVietnam, and welcome other investorsto make follow-on investments in ourinvestee companies. 9
  • 10. ExceptionalLocal TeamThe core of our strategy is to continuouslyinvest in the development of an excellentVietnamese team. We believe that anexceptionally strong Vietnamese teamat the most senior levels provides us asignificant advantage as an investor inVietnam.Almost all of Mekong Capital’s seniormanagement team are Vietnamese, whoare also shareholders of Mekong Capital.As of July 2007, current managers andemployees hold approximately 72% ofMekong Capital’s shares, which helps toensure that our managers and employeesare highly committed and motivated.10
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  • 13. Fast GrowingCompaniesThe investee companies of our firstfund, Mekong Enterprise Fund, haveachieved average revenue growth of34.5% per year, and average net profitgrowth of 46.9% per year, during theperiod in which the Fund has held thoseinvestments (through the period ending 31December 2006). Investment Strategy We believe that long-term investment success is strongly connected to the development of excellent management teams in the companies in which we invest. In particular, we invest in companies which we believe have a very strong commitment to continuously developing their management teams, as we believe this is the best predictor of how rapid and sustainable their future growth will be. 13
  • 14. DisciplinedApproachWe are a highly conservative investor - weaim for each one of our investments to besuccessful.When considering an investment,we place significant emphasis on themanagement teams of potential investeecompanies, especially their commitmentto continuously strengthening themanagement team, growing the companyat an attractive rate, and achieving asuccessful listing on a stock exchangeby improving financial reporting andcorporate governance.We prefer companies that are focusedon excellence in a single industry insteadof companies that are involved in severaldifferent industries.We also strongly prefer companiesthat are focused on creating long-termshareholder value, as opposed to short-term profits.14
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  • 16. Target Industries We typically focus on companies involved in some combination of the following: - Manufacturing, processing and assembly; - Marketing and branding of physical products; - Distribution; and - Retail. Generally we prefer to invest in well-proven and scalable business models, where the key determinant of success is how well the management team can execute on its strategy and expansion plans.16
  • 17. Focus On ASingle BusinessMekong Capital’s only business isinvestment management, and wecurrently have no plans to expand intoother kinds of business, financial servicesor consulting work. We do NOT acceptfees from the companies in which ourfunds invest.This means that we always strive forexcellence as an investor, and arenot distracted by other businesses orobjectives. 17
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  • 19. OUR FUNDS 19
  • 20. Mekong Enterprise Fund, Ltd. Mekong Enterprise Fund is a $37 million (1) private equity fund focusing on investments in fast-growing private companies in Vietnam. The Fund’s strategy is to help these companies grow at the fastest rate possible, and to help those companies prepare for successful listings on a stock exchange. The Fund’s life is expected to be 10 years from the date of its launch in April 2002. When the Fund makes an investment, it expects to hold the investment for 4 to 8 years. Mekong Enterprise Fund is currently holding 10 investments, which were initially made in 2003, 2004 and 2005. Most of these are expected to be listed on a stock exchange by the end of 2009.(1) Based on the Fund’s official Net Asset Value as of 30 June 2007. 20
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  • 23. Mekong Enterprise Fund II, Ltd. Mekong Enterprise Fund II is a $50 million (2) private equity fund that focuses on investing in well-managed, fast- growing private companies in Vietnam. The Fund’s strategy is to help these companies grow at the fastest rate possible, and prepare for successful listings on a stock exchange. The Fund’s life is expected to be 10 years from the date of its launch in June 2006. When the Fund makes an investment, it expects to hold the investment for 4 to 8 years. Although the Fund has a similar strategy to that of Mekong Enterprise Fund, it places a greater emphasis on investing in companies involved in selling to the domestic consumer market in Vietnam, such as branded consumer products, distribution and retail. The Fund also has a more selective focus on investing only in companies that are truly committed to building up an excellent management team.(2) Based on the Fund’s Committed Capital. 23
  • 24. Vietnam Azalea Fund Limited Vietnam Azalea Fund is a $100 million (3) privatization fund, which was launched in June 2007. Vietnam Azalea Fund leverages Mekong Capital’s strong on-the-ground presence and investment experience by investing primarily in pre-listed equitized (privatized) companies in Vietnam, especially companies in the early stages of privatization. Usually these investments would be made in the form of private placements or auctions. Vietnam Azalea Fund, therefore, targets a different universe of companies than Mekong Enterprise Fund and Mekong Enterprise Fund II, which focus primarily on private companies which were never under state ownership. The Fund aims to invest mainly in companies 12-24 months prior to the dates at which they are expected to be listed. However, Vietnam Azalea Fund is similar to Mekong Capital’s other funds insofar as it aims to invest in companies with a strong commitment to continuously developing their management teams, and which are taking steps to constantly improve their financial reporting and corporate governance standards.(3) Based on the Fund’s Committed Capital. 24
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  • 27. HOW WE ADD VALUE 27
  • 28. Types Of Assistance Projects Mekong Capital provides significant levels of support to our investee companies without directly involving ourselves in the management or making management decisions. We focus on projects that will contribute to profit growth and the ability of the investee companies to achieve successful listings on the stock market at attractive valuations. Most of our assistance projects involve helping the companies to strengthen the capacity of specific functions within their management teams. We do NOT accept any fees from the companies in which we invest, and we do not provide any fee-based consulting services.28
  • 29. RecruitmentMekong Capital’s Recruitment Teamhelps to fill job openings for managersat investee companies. In additionto using our own networks, we helpcoordinate with executive search firmsand other sources of job candidates.On average we have identified andfilled management positions in ourinvestee companies at a rate of aboutone per week. In some of our investeecompanies, more than 50% of the seniormanagement team members wereintroduced by Mekong Capital.We work with our investee companies tomake them more attractive employersto highly qualified managers withexperience working for multinationalcompanies in Vietnam. We also try tosupport the smooth integration of newmanagers into our investee companies. 29
  • 30. Financial Reporting And Management Mekong Capital’s Accounting and Finance Team consists of at least 6 people who were former Auditors from international auditing firms such as KPMG and Ernst & Young. They help our investee companies to improve tax compliance, accounting policies and procedures, internal controls, presentation of financial reports, and financial planning and management systems. This work is an important prerequisite to achieving a successful listing on a stock exchange, because many investors will pay a premium to invest in companies with reliable and insightful financial reporting. By working closely with some of our investee companies to implement Activity Based Costing, our investee companies have more useful information on their actual profit according to different products, customers or divisions. This has helped these companies to improve their overall net profit margins by shifting their priorities towards the more profitable areas, and pricing their products more accurately.30
  • 31. StrategyAnd ExpansionPlanningWe work with our investee companies toset more ambitious targets for expansionplans, and then work together to solvethe obstacles which could preventthem from achieving those plans.Consequently, our investee companiesoften grow faster than they might if ourfunds had not been an investor.While we believe that a company’sstrategy should originate from thecompany’s Chairman and CEO, as wellas other members of the managementteam, we often provide feedback basedon our experience with other companiesin Vietnam, or our knowledge of similarcompanies in other countries. 31
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  • 33. ProcessImprovementMekong Capital’s Process ImprovementTeam works closely with investeecompanies to help them implement LeanManufacturing, Six Sigma and otherforms of process improvement.Lean Manufacturing is a set of toolsand methodologies for the continuouselimination of waste in the productionprocess. The main benefits of this arelower production costs, lower inventorylevels, fewer defects, increasedoutput and shorter production leadtimes. Likewise, this method is equallyapplicable and effective for non-manufacturing/servicing processes.Six sigma is a data-based processimprovement methodology . Six sigmaprovides a framework and set of toolsto identify and eliminate the root causesof inconsistency in business/productionprocesses. Meanwhile, six sigma helpsto create a culture of systematically andpro-actively fixing the factors that arethe root causes of product defects andservice errors.Our process improvement team hasorganized Vietnam’s first processimprovement club. More informationavailable at this website:http://www.vietnamkaizen.com 33
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  • 35. Preparing ForSuccessful ListingWe work closely with our investeecompanies to help them prepare for asuccessful listing on a stock exchange,including the development andimplementation of a listing plan.Mekong Capital’s reputation as a highlydisciplined and selective investor, aswell as the assistance that we provideto our investee companies, helps thesecompanies become more attractive to abroad range of investors. 35
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  • 38. AA Corporation AA Corporation’s (“AA”) manufacturing and export division manufactures high-end indoor furniture, which is exported as well as sold to domestic furniture retailers in Vietnam. AA Corporation differentiates itself from other furniture manufacturers in Vietnam by focusing on high-end indoor furniture that requires advanced finishing techniques and significant attention to detail. Export customers include international furniture brands, retail chains, as well as high-end hotels in the U.S. and Middle East. AA’s retail division, which owns Nha Xinh and DECO retail chains, has 5 furniture showrooms in Vietnam. Products include all kinds of indoor furniture including sofas, dining sets, kitchen systems, cabinets, etc. AA’s interior design division is the leading interior design contractor for large international standard hotel and building projects in Vietnam, with recent customers including hotels managed under the Park Hyatt, Sheraton, Intercontinental and Sofitel brands. Lately this division is becoming more active in overseas projects, such as hotel renovation projects in the U.S. and Middle East. AA’s revenues in 2006 were US$16 million.38
  • 39. Duc Thanh Wood ProcessingDuc Thanh is the leading professional manufacturer of kitchenware and householdutensils made of rubber-wood and acacia-wood in Vietnam. Duc Thanhdifferentiates itself by a very high level of operational excellence and control over themanufacturing processes, resulting in high quality and consistent on-time delivery.Duc Thanh’s revenues in 2006 were $6.5 million, an increase of 29% from 2005levels and an increase of 126% compared to 2004 levels. Duc Thanh has around800 employees. 39
  • 40. Goldsun Goldsun is a Hanoi-based company with two main business lines - carton packaging and kitchenware. Production for these two business lines is located in two separate sites in Hanoi. Goldsun produces high-quality cardboard cartons, used for the packaging of consumer products such as consumer electronics, household and food products. The company also manufactures and distributes metal kitchenware including gas stoves for retail, stainless steel pans and other kitchen utensils. Its high-end products are sold under the Goldsun and Kinen brands. Goldsun’s kitchenware division maintains a network of distributors throughout Vietnam, with a main focus on the Northern provinces. Goldsun’s revenues were $10 million in 2006, an increase of 28% compared to 2005 levels.40
  • 41. InternationalConsumption ProductsInternational Consumption Products (“ICP”) is one of the most successful and fast-growing Fast Moving Consumer Goods companies in Vietnam. It markets anddistributes well-established brands in Vietnam such as:- Vegy (food cleaning products)- OCleen (household cleaning)- X-Men, Hatrick and Teen-X (men’s personal care)- Dr. Men (men’s anti-dandruff shampoo)- L’Ovite (French skin-care and cosmetics)ICP’s X-Men brand is the market leading brand in the men’s personal care market in Vietnam.ICP’s rapid growth can be attributed to the company’s unwavering commitmentto meeting international standards of product quality, substantial investment inbrand building and continuous development of an excellent management team.ICP’s success also reflects the company’s continuous pursuit of sustainable growthopportunities.ICP’s revenues in 2006 were $12.9 million. 41
  • 42. Investment & Trading of Real Estate Joint Stock Company Investment & Trading of Real Estate Joint Stock Company (“Intresco”) is one of the fastest-growing real estate developers in Vietnam. The Company develops and sells residential properties and commercial buildings, mainly in the Ho Chi Minh City area. Formerly owned by the Ho Chi Minh City People’s Committee, the Company’s success comes from its capability to continuously expand its land bank, as well as its strong project management capacity. The company’s properties have a reputation for quality in a market in which many developers meet lower standards. Intresco’s revenue in 2006 was approximately $25.5 million, a 41.4% increase from 2005.42
  • 43. Lac Viet ComputingLac Viet distributes a broad range of IT hardware and software products and servicesto meet customers’ needs for complete solutions.Lac Viet also develops a number of pre-packaged software applications, some ofwhich are the market leaders in their respective product categories in Vietnam, suchas the AccNet accounting software and the Lac Viet MTD dictionary.Lac Viet’s revenues were $8.2 million in 2006, an increase of 52% compared to2005 levels. By the end of 2006, Lac Viet had approximately 300 employees in itsthree offices in Ho Chi Minh City, Hanoi and Danang. 43
  • 44. Minh Hoang Garment Minh Hoang is one of the largest private garment manufacturing companies in Vietnam both in terms of workforce and production capacity. As of late 2006, the company had around 2,000 employees and 39 production lines at their two factories in Ho Chi Minh City and Quang Nam Province, near Danang. Minh Hoang manufactures woven and knitted sportswear for leading international athletic-wear companies, with Nike as its largest customer. Minh Hoang’s products are mainly shorts, jackets, sports pants and vests. The Company also manufactures T-shirts, Polo-shirts, children’s jackets, and ladies wear. Minh Hoang is believed to be the first private company in Vietnam to comprehensively implement lean manufacturing on its factory floor, resulting in significant efficiency improvements. In 2006, Minh Hoang’s revenues were $12.7 million, representing an increase of 39% compared to 2005 revenues, and more than 130% compared to 2004 revenues.44
  • 45. Minh PhucManufacturing and TradingMinh Phuc is a Vietnamese package printing company, specializing in printing paper-based packaging, metal foil, labels and envelopes. Minh Phuc has modern printingequipment and utilizes both offset and rotogravure printing technologies. MinhPhuc has a track record of pro-actively identifying and capturing new niche marketopportunities in Vietnam’s fast-growing printing industry.Minh Phuc’s revenues in 2006 were approximately $7.6 million. 45
  • 46. Ngo Han Joint Stock Company Ngo Han is a leading manufacturer of magnet wire in Vietnam. The company produces copper rod, as well as round and rectangular magnet wire of various sizes. Magnet wire is used primarily in motors, transformers, ballasts, voltage stabilizers, electronic components and other items used to generate or transform electromagnetic fields. Ngo Han is believed to be the first private company in Vietnam to implement six sigma in certain processes, and this has helped the company to maintain high quality standards while reducing costs. The Ngo Han brand is strongly associated with consistent quality. Ngo Han’s revenues in 2006 were $32 million, an increase of 104% compared to 2005. Volumes are expected to increase significantly in 2007 as the company nearly doubled its production capacity at the end of 2006.46
  • 47. Nam HoaProduction and TradingNam Hoa is a leading Vietnamese manufacturer of children’s wooden toys.Nam Hoa differentiates itself by a corporate culture of high commitment to toyquality, safety standards and close attention to detail. Nam Hoa also has a strongcommitment to continuously developing the quality of its management team andimproving its management systems.Nam Hoa’s products are primarily educational toys and children’s furniture, includingcubic toys, wooden blocks, doll houses with miniature furniture, animal trains,wooden fruit sets, sorting boxes, miniature roller coasters, baby strollers, children’stables, children’s chairs, etc.Revenues in 2006 were $3.2 million, an 80% increase in compared with 2005. NamHoa has approximately 700 employees. 47
  • 48. Saigon Gas Holdings Saigon Gas Holdings Corporation is a fast growing LPG distribution company, and is the largest private company operating in this industry in Vietnam. Saigon Gas supplies Liquefied Petroleum Gas (LPG) in Southern Vietnam for industrial use, delivered by LPG tank lorries, and for residential and commercial use, delivered in metal cylinders. The cylinders are filled at Saigon Gas’ own filling stations and distributed under the Saigon Gas brand. They also provide LPG tank installation and maintenance services for industrial users. Saigon Gas also manufactures the gas cylinders used for the residential LPG market at its factory in Binh Duong province. Monthly LPG volumes are currently approximately 3,500 – 4,000 MT. Revenues in 2006 were $28.5 million, an increase of 29% from 2005 levels. Saigon Gas employs more than 200 employees.48
  • 49. Tan Dai Hung PlasticTan Dai Hung manufactures Poly-Propylene (PP) woven bags, typically used tohold commodities such as fertilizers, rice, sugar, animal feeds, chemicals and otheragricultural products. Other products include shopping bags, landscape fabrics,Jumbo bags, Container bags, Raschel bags, Leno bags, PP laminated Poly-Ethylene(PE) bags, High Density Poly-Ethylene (HDPE) and Low Density Poly-Ethylene (LDPE)bags.In late 2006, Tan Dai Hung implemented a major relocation to a new and largerfactory in Long An province, around 30 km from Ho Chi Minh City. The new site hasfour times the space of the previous site and therefore provides the company with theopportunity to further accelerate its rate of growth.Tan Dai Hung plans a listing in the stock market in Ho Chi Minh City at the endof 2007. Revenues in 2006 were $12.7 million, an increase of 25% compared to2005. The company has more than 1,000 employees. 49
  • 50. The Gioi Di Dong - Mobileworld Mobileworld is one of the fastest growing and largest mobile phone retailing chains in Vietnam. The Company operates a chain of branded mobile phone retail outlets, including one laptop retail outlet, and one service center in Ho Chi Minh City. Each retail outlet is located at premium location with high traffic, offering a wide selection of over 250 mobile phone models. The Company functions within the “modern trade” segment offering value-added services to customers unlike traditional family-run stores. Customers are serviced by knowledgeable staff that offer well- informed advice on different models and features. The company’s website, www.thegioididong.com, is the most popular website in Vietnam relating to mobile phone retail, and is among the top 30 most frequently visited websites in Vietnam according to Alexa.com. Led by a group of young entrepreneurial Vietnamese professionals with extensive experience and industry expertise, Mobileworld has experienced significant growth since inception. The company currently employs more than 600 employees and expects revenues of more than $40 million in 2007.50
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  • 52. HO CHI MINH CITY RESIDENT REPRESENTATIVE OFFICE CAPITAL PLACE, 8TH FLOOR 6 THAI VAN LUNG STREET, DISTRICT 1 HO CHI MINH CITY, VIET NAM Tel: (84 8) 827 3161 - Fax: (84 8) 827 3162 E-mail: info@mekongcapital.com HANOI REPRESENTATIVE OFFICE HAREC BUILDING, 12TH FLOOR 4A LANG HA STREET, BA DINH DISTRICT HANOI CAPITAL, VIETNAM Tel: (84 4) 772 4888 - Fax: (84 4) 772 4868 E-mail: info@mekongcapital.com www.mekongcapital.com52