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Warburg Pincus, Becamex IDC commit over $200m to create logistics and industrial platform in Vietnam

Published 13 February 2018

Warburg Pincus and Becamex IDC announced that their affiliates have formed a joint venture, BW Industrial Development Joint Stock Company (BWID), to focus on the development of institutional-grade industrial and logistics properties across Vietnam.

With a best-in-class management team, sizable land holdings and a robust pipeline, BWID is well positioned as a fully integrated platform to capture the robust demand for modern logistics warehouses, build-to-suit and ready-built factories and other industrial facilities with a focus on the key economic and industrial zones driving growth in Vietnam.

Established in 1976, Becamex specializes in developing large-scale industrial townships with one of the largest industrial landbanks in key markets across Vietnam. Over the past 20 years, Becamex has been a pioneer in the industrial real estate industry in the country with the creation of over 10 world class industrial parks with Fortune 500 companies as its existing business partners and clients.

Historically, Becamex has formed a number of partnerships with foreign players such as TOKYU Corporation, a major Tokyo-based infrastructure developer, and Sembcorp, a Temasek-sponsored industrial group through the Vietnam Singapore Industrial Park platform (VSIP), which is now widely recognized as one of the most successful industrial park developers in Vietnam with over $10bn of investments to-date.

Nguyen Van Hung, Chairman of Becamex, commented, “With a proven track record as the leading private equity investor in Vietnam as well as in building the top real estate and logistics platforms across Asia, we are delighted to partner with such an esteemed firm like Warburg Pincus.

We believe that the recent government policies (including significant trade deals) and a strong focus on infrastructure have transformed Vietnam into one of the world’s most attractive investment destinations which in turn will continue to create outsized demand for modern institutional-grade industrial and logistics properties and services.”

Vietnam ranks as one of the fastest growing economies in Southeast Asia as well as globally with a GDP growth rate of 6.8%. In 2017, Foreign Direct Investment (“FDI”) hit yet another record high of $36 billion, which represents over a 40% increase over the previous year.

Among the industries, the manufacturing-processing industry remained the top sector accounting for over 40% of total FDI in 2017.

Warburg Pincus Southeast Asia head and managing director Jeffrey Perlman said: “With the transformative shift of the manufacturing base from markets like China to Vietnam as well as with the rapid rise of domestic consumption, the logistics and industrial real estate market in Vietnam is in the “early innings” and at an inflection point for outsized growth.”

Warburg Pincus started investing in Southeast Asia in 2013 with Vietnam as its maiden market. Since then, Warburg Pincus has committed over $1 billion in the region, including in Vincom Retail, Lodgis Hospitality, ARA Asset Management, Go-Jek, NWP, Trax, and others.

Vincom Retail, a joint venture retail platform established between Vingroup and Warburg Pincus in 2013, has grown into the largest shopping mall developer and operator in Vietnam. Its highly successful $740 million listing on the Ho Chi Minh Stock Exchange last November was the largest-ever IPO in Vietnam

Warburg Pincus is a global forward thinking leader in logistics. It is one of the first private equity firms to recognize the need to transform the logistics value chain on the back of the rise of e-commerce nearly a decade ago and has invested in 28 companies along all high-growth segments of the value chain.

Source: Company Press Release