Becamex and Warburg Pincus form Vietnam logistics JV

HO CHI MINH CITY — Global private equity firm Warburg Pincus on Monday announced it was setting up a $200 million logistics joint venture with Vietnamese real estate and infrastructure developer Becamex IDC Corp (Becamex). The joint venture — BW Industrial Joint Stock Company — will focus on the development of institutional-grade industrial and logistics properties across Vietnam, according to Warburg Pincus.

Last September, the two parties signed a strategic cooperation agreement to create a logistics joint venture, worth some $200 million at the first stage, with investment increasing to more than $1 billion over the next five years.

The joint venture is expected 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 that are driving growth in Vietnam.

Becamex, founded in 1976, is the biggest state-owned enterprise in the southern province of Binh Duong. The group has partnered with several foreign investors, including Sembcorp Industries of Singapore and TOKYU Corporation of Japan, for infrastructure development of large-scale industrial townships and industrial parks in key markets across Vietnam. Becamex operates nine world-class industrial parks and five urban areas in Vietnam.

Following its disappointing initial public offering last December, in which only 6% of offered shares changed hands, Becamex plans to list over 23.4 million shares on the secondary market, after Vietnam’s Tet holidays this month. The listing is set for Feb. 21 with a starting price of 31,000 dong per share.

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

Warburg Pincus has invested in dozens of logistics companies along all high-growth segments of the value chain, and in areas including India, China and Southeast Asia.

In Vietnam, Warburg Pincus and Credit Suisse invested a total of $300 million for a 20% stake in Vincom Retail, a subsidiary of leading private property developer Vingroup. The retail platform has grown into Vietnam’s largest shopping mall developer and operator, which saw the largest-ever IPO in Vietnam when it raised around $713 million last October. 

Vietnam’s recent focus on infrastructure development is expected to help the country become one of the world’s most attractive investment destinations. In 2017, foreign direct investment reached $35.8 billion, a year-on-year increase of 44%. The country also ranks as one of the fastest-growing economies, with gross domestic product of 6.8% last year.


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