Warburg Pincus to invest in Vietnamese logistics with Becamex IDC

Private equity firm Warburg Pincus has announced plans to invest in Vietnamese logistics with local developer Becamex IDC.

Warburg Pincus said the joint venture, to be known as BW Industrial Joint Stock Company (BWID), will develop institutional-grade industrial and logistics properties across the country.

Warburg Pincus declined to mention the specific value of the investment, but IPE Real Assets has previously reported that initial investment would be close to US$200m (€166m).

Last September, in a statement to Vietnamese stock exchange, the Becamex IDC said the aim was to grow assets to US$1-2bn over the next five years.

In a statement today, Warburg Pincus said BWID will become a fully integrated platform to capture demand for modern logistics warehouses, build-to-suit and ready-built factories and other industrial facilities.

It will target developments in key economic and industrial zones in Vietnam.

Jeffrey Perlman, Warburg Pincus’ managing director and head of Southeast Asia, said Vietnam is being transformed by a shift in manufacturing from markets like China.

He said that, coupled with the rapid rise of domestic consumption, Vietnam’s logistics and the industrial real estate market is in the “early innings” for growth and at an inflection point for “outsized” growth.

He said the partnership enables Warburg Pincus to leverage Becamex’s “unrivalled” local sector knowledge and experience to build the leading platform in Vietnam.

Established in 1976, Becamex develops large-scale industrial townships and has one of the largest industrial land banks across Vietnam.

Over the past two decades, the Vietnamese company has developed 10 industrial parks to house Fortune 500 companies, with a total value of US$10bn.

Becamex has previously partnered with Japanese group Tokyo Corporation, and Sembcorp, a Temasek-sponsored industrial group, through the Vietnam Singapore Industrial Park platform.

Nguyen Van Hung, Becamex’s chairman, said: “We believe that recent government policies and a strong focus on infrastructure have transformed Vietnam into one of the world’s most attractive investment destinations.”

Warburg Pincus’s other investments in Vietnam includs Vincom Retail, a joint venture retail platform established between Vingroup and Warburg Pincus in 2013, now the largest shopping centre developer and owner in Vietnam.

The New York-based firm used Vietnam as its launch pad for a foray into Southeast Asia in 2013. Since then, Warburg Pincus has committed over US$1bn in the region.

One of its most rapidly growing investments is ESR, a regional logistics player which has been expanding its footprint across Asia in the past two years.

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