Although participating in this survey was entirely voluntary, fund managers participating in this survey are the representative samples of leading managers, mostly having reputation and prestige on the market.

They included Dragon Capital, Indochina Capital, Mekong Capital, Prudential Vietnam, VinaCapital, BankInvest, and AIM Capital Management.

The survey, conducted in December on seven leading managers in Vietnam, also show that respondents, who are fund managers, have poured over $1.8 billion into investments in private enterprises in Vietnam since 2003, with about 200 enterprises.

The year 2007 saw the largest amount of investment when more than $750 million was placed into private equity investments, but significant decrease occurred in the following years.
The average holding period for an investment until it is partially or wholly divested is usually three years. This period tends to increase during the survey period.

Divestments in 2010 were made after an average of four to five-year holding period.

Based upon the large number of investments made in 2007, the next two years should result in a large number of investment exits by the fund managers” says Ken Atkinson, Managing Partner of Grant Thornton Vietnam.

The survey also found that listing on stock market continues to be the most common method used to divest capital of fund managers, accounting for over 60 percent of the total number of divestment transactions.

This is due to the relatively lower barriers to list and the less onerous compliance requirements for listed companies in Vietnam, Grant Thornton said.

In the context when the capital market has been tightened due to the global financial crisis, by divesting, fund managers could continue to make new investments without raising additional capital. Therefore, the success level of divestment achieved by fund managers is a significantly important factor of the sector.

The survey of Grant Thornton Vietnam was to seek and clarify the activity level of divestment through leading fund managers.

Source: Tuoitre.