The deal involved the transfer of renewable energy projects to a subsidiary of Sembcorp Group, a leading corporation from Singapore.
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Gelex Group representative receives M&A deals award in 2023-2024. Photo courtesy of Gelex |
The M&A deal was commended by the voting council based on several key criteria: deal size, nature, significance, and effectiveness. Gelex’s partnership with Sembcorp was highlighted as a strategic move in the renewable energy space. The two companies signed an investment cooperation agreement in 2023, and by 2024, Sembcorp Industries had acquired shares and capital contributions in several operating energy projects from Gelex Group. To date, 3 out of 4 projects in this deal have been successfully transferred.
Sembcorp Industries, part of the Sembcorp Group, is a major integrated urban and energy solutions provider based in Singapore. It is listed on the Singapore Stock Exchange and is part of the Straits Times Index (STI), which tracks the top 30 largest companies on the exchange. Temasek Holdings, Singapore’s government investment fund, owns 49% of Sembcorp’s capital.
For Gelex, this deal goes beyond a financial transaction. As a representative from the company explained, the divestment is part of a broader strategy to select the right partners for future projects. “We are looking forward to collaborating with capable investors,” said the representative. “The cooperation with Sembcorp will allow Gelex to maximize its potential and strengthen its position in both the Vietnamese and international markets.”
The deal comes as the global economy and Vietnam’s economy begin to recover, and the M&A market is showing signs of activity again after a period of stagnation.
According to KPMG Vietnam, 174 transactions were recorded in 2024 as of October, with a total announced value of approximately $2 billion. While the number of transactions increased by about 21% compared to the same period last year, the total value declined by 54%, reflecting the challenges posed by a global economic slowdown, high USD interest rates, and investor caution.
Despite these obstacles, strategic transactions remain a focus, with investors looking for value-driven opportunities rather than speculative deals. This has helped attract both international and domestic investors to Vietnam’s M&A market.
The trend of increasing participation from domestic enterprises in M&A deals is evident. KPMG projects that 40% of M&A deals in 2024 will involve Vietnamese companies, a significant rise compared to previous years. This shift highlights the growing strategic maturity of local businesses, who are increasingly using M&A as a tool to innovate, scale, and strengthen their competitiveness both locally and globally.
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In addition to Gelex’s success, other major M&A deals in 2024 include VPBank’s sale of a 15% stake to Sumitomo Mitsui Financial Group (SMBC) from Japan and Sycamore, a subsidiary of CapitaLand Group, acquiring the Tan Thanh Binh Duong urban housing project from Becamex IDC.
These developments reflect a positive trend in the M&A landscape, signaling a more active market as domestic companies take a more proactive approach in seeking strategic partnerships. The continued maturity of Vietnam’s business sector is expected to foster further growth in M&A activities, with a strong forecast for 2025 as the economy recovers and foreign investment flows into the country.
