Keppel sells stakes in Saigon Sports City and Saigon Centre

The two deals are expected to bring Keppel a total of VND6.5 trillion to VND7.4 trillion, ($270-308 million) approximately, subject to conditions, including obtaining regulatory approval, according to a Keppel statement.

Keppel subsidiary Jencity Limited has divested 35 per cent of the charter capital of Saigon Sports City Limited (SSCL) to HTV Dai Phuoc Co., Ltd. and 35 per cent to Vinobly Investment Real Estate JSC.

Jencity Limited holds the remaining 30 per cent of the charter capital in SSCL, which is now developing approximately 64 hectares in Ho Chi Minh City.

HTV Dai Phuoc Co., Ltd. will pay Jencity a cash consideration of approximately VND320 billion ($13.3 million approximately), depending on when the conditions are fulfilled, and subject to completion adjustments, for 5 per cent of the charter capital of SSC.

The consideration will be payable in full upon registration of the equity transfer with the regulatory authorities. It was arrived at on a willing-buyer, willing-seller basis, taking into account, among others, the net asset value of the 5 per cent sale stake, which was approximately VND137 billion ($5.7 million) as of June 30.

HTV Dai Phuoc Co., Ltd. will also pay Jencity Limited a cash consideration ranging from approximately between VND2.87 trillion ($199.9 million) and VND3.29 trillion ($137 million) depending on when the conditions precedent are fulfilled, including obtaining regulatory approvals for the project in Ho Chi Minh, for 30 per cent of the charter capital of SSCL.

Vinobly will pay Jencity a consideration ranging from approximately VND3.35 trillion ($139.9 million) to VND3.8 trillion ($159.9 million) depending on when the conditions are fulfilled, and subject to completion adjustments, for 35 per cent of the charter capital of SSCL.

The Saigon Sports City project located in An Phu ward, Thu Duc city, Ho Chi Minh City. Photo Le Toan

Also the same day, Keppel Ltd announced that Japan's Toshin Development has subscribed for 46,364,475 ordinary shares in Himawari VNSC3, one of its subsidiaries.

Saigon Centre Investment holds the remaining 46,550,305 ordinary shares in Himawari VNSC3.

Himawari VNSC3 holds class C preference shares in each of Keppel Land (Saigon Center) Limited and Krystal Investments Pte. Ltd, which are holding 68 per cent and 16 per cent respectively of the total equity interest in each of Keppel Land Watco-IV Co., Ltd. and Keppel Land Watco-V Co., Ltd. Keppel Land Watco-IV and Keppel Land Watco-V together hold the land use rights in respect of Saigon Center Phase 3 located in District 1, which is undergoing planning and is intended to be a mixed-use development.

Toshin shall pay a cash consideration of approximately $46.4 million for the subscription of the new shares, to be paid in seven tranches, with the last tranche to be paid after the construction permits have been issued for KLW IV and KLW V.

The Saigon Sports City project broke ground in February 2019 with an estimated capital of $500 million on a 64-hectare plot in An Phu Ward, Thu Duc City. When completed, Saigon Sports City is expected to provide thousands of luxury apartments as well as sports, entertainment, and lifestyle facilities for its residents.

Saigon Center Phase 3 is a component of the Saigon Center project located in District 1 with a total area of 2ha.

Of which, Phase 1 consists of 25 floors of offices and apartments for lease, and has been in use since 1996. Located next to it, Phase 2 was completed and put into operation in 2016 with 43 floors and 47,000 square metres of office, 44,000sq.m of retail, and 195 serviced apartments.

Phase 3 will cover ​​8,600sq.m and is undergoing planning.

Keppel has been conducting multiple M&A projects in Vietnam. In July 2023, through its wholly-owned subsidiary, VN Prime Vietnam Co., Ltd., it acquired a 65 per cent stake in ProjectCo for an aggregate consideration of approximately $51.2 million in the heart of Hanoi.

The project is part of a mixed-use commercial development, which is under construction and slated for completion in 2025.

Binh Minh Investment and Trading Development JSC holds the remaining 35 per cent interest in ProjectCo.

In May 2023, Keppel Corporation and Keppel Vietnam Fund (KVF) entered into agreements to acquire a 49 per cent interest in two adjacent residential projects in Thu Duc City from the Khang Dien Group for an aggregate consideration of approximately $138 million.

The shareholding ratio between Keppel and KVF, one of Keppel’s private funds, in the Keppel Consortium is 50-50.

The total development cost for the projects, inclusive of land, is expected to be around $443 million. The Keppel Consortium and Khang Dien Group plan to jointly develop more than 200 landed homes and over 600 high-rise apartments on the two sites, which have a total area of about 11.8ha.

Keppel Corporation Ltd. (Keppel) and Keppel Vietnam Fund (KVF), jointly known as the Keppel Consortium, have entered into binding agreements to acquire a 49 per cent interest in two adjacent residential projects in Thu Duc City from the Khang Dien Group for an aggregate consideration of approximately $138 million.

Singaporean Keppel Corporation on July 6 announced that Keppel Land Ltd., through its wholly-owned subsidiary, VN Prime Vietnam Co., Ltd., is acquiring a 65 per cent stake in a company ProjectCo, which will hold a retail property in Hanoi.

The global operating environment was challenging in 2023, with geopolitical conflicts, slow global growth, high interest rates, and extreme climate events. The Vietnamese economy, including its domestic real estate market, was not immune to these challenges.