Japanese investors are willing to spend hundreds of millions of dollars on logistics and energy in Vietnam.

VTV.vn - Japanese investors are particularly interested in a number of key sectors in Vietnam, including Logistics, healthcare and renewable energy.

Vietnamese enterprises have advantages when promoting M&A in Japan

According to the Vietnam M&A report, in 2024, the market recorded 447 M&A deals with a total announced value of about 6.93 billion USD. The deals focused on strategic industries such as technology, healthcare, logistics, renewable energy and financial services. Foreign investors – including Japan – continued to account for 70% of the transaction value, showing great demand for the Vietnamese market. This recovery creates many opportunities for Vietnamese businesses to access capital, technology and international management experience.

In order to update investment and M&A trends, on the afternoon of October 4, the Hanoi Association of Small and Medium Enterprises in collaboration with One Value organized the Workshop "The wave of trade and investment from Japan and opportunities for small and medium enterprises" .

Delegates attending the workshop

Speaking at the opening of the workshop, Professor, Dr. Mac Quoc Anh, Vice President and General Secretary of the Hanoi Association of Small and Medium Enterprises, said that Vietnam has now participated in 17 free trade agreements, opening up many opportunities for international cooperation.

Among them, the Japanese market is one of the important markets with many Vietnamese products present and well received by Japanese consumers. In return, Japanese goods and products are increasingly trusted and favored by Vietnamese consumers.

Currently, Vietnam has about 940,000 enterprises, of which Hanoi has about 420,000 enterprises (98.5% are small and medium enterprises). This is a large force but still modest in scale, so learning from the management experience and practices of large partners such as Japan is necessary, in order to maximize cooperation opportunities and improve the quality of operations.

At the forum, Ms. Phi Hoa, CEO of One Value, analyzed that Japan has always been one of the leading countries in terms of foreign direct investment (FDI) flowing into Vietnam, often in the top 3 or top 5 of the largest investing countries. Ms. Hoa commented that the biggest driving force for M&A from Japan is the aging population and the devaluation of the Yen.

"The trend of the Yen continuing to depreciate in the next 10 years is an unchangeable trend. Therefore, the sooner they do M&A, the more valuable products people will be able to buy," said Ms. Hoa.

On the contrary, the trend of Vietnamese enterprises conducting M&A in Japan is a new and growing development. Ms. Hoa pointed out that more than 60% of the 4 million small and medium enterprises (SMEs) in Japan have owners over 70 years old and lack successors. This has created a wave of domestic M&A and many companies are sold at very cheap prices, sometimes "only about 1 billion to several tens of billions of VND". Because the Vietnamese currency has appreciated compared to the Yen, this is an advantage for Vietnamese enterprises when promoting M&A in Japan.

Ms. Hoa summarized the three biggest challenges often encountered in cross-border M&A transactions. These are differences in business culture and decision-making styles; lack of transparent financial information; and divergent expected valuations.

Logistics, healthcare and renewable energy are of interest to investors

According to Ms. Phi Hoa, Japanese investors are particularly interested in a number of key sectors in Vietnam, including Logistics, healthcare and renewable energy.

Specifically, the Logistics, Transportation and Cold Storage industry is a very "hot" field because the explosion of e-commerce has caused these services to not keep up with changes in consumer behavior. Investment demand in this industry is huge, with budgets ranging from 4 million to about 200 million USD with the desire to buy from 51% to 100% of shares.

The healthcare and medical sector is also in high demand. Ms. Hoa explained that Vietnamese people are willing to spend a lot on on-demand medical services. Investment needs are diverse, including opening clinic chains, opening joint venture hospitals, supplying medical materials, MedTech and developing elderly care services.

The renewable energy sector is also focused on projects rather than companies by Japanese investors. According to calculations, Vietnam needs energy growth of 12% to 16% to support the GDP growth target of 8%. The budget for each energy project is usually between 30 million and about 200 million USD. The areas of interest are wind power, solar power, biomass and hydropower. In addition, they are also interested in manufacturing auxiliary equipment such as batteries, electrical cabinets and high voltage wires.

Other industries that also attract capital flows from Japan include: Information Technology (IT); trade and retail; manufacturing, mainly related to food, garment, supporting industries (such as metal sheet assembly for automobile/automatic production), industrial food production, sauces and spices.

Ms. Hoa also noted that M&A is not only buying and selling businesses but also through the form of establishing joint ventures (cooperation), which is considered M&A in a broad sense.

Source: https://vtv.vn/nha-dau-tu-nhat-ban-san-sang-chi-hang-tram-trieu-usd-cho-logistics-nang-luong-tai-viet-nam-10025100417455869.htm