Is Apple About to Set-up Company in Vietnam?

Setting up company in Vietnam

In the August 2015 work plan of the Ho Chi Minh City People’s Committee, it has been recently revealed that a section to review the registration of a company named Apple Vietnam company limited. Is it the American multinational teconology company with its famous products i.e. Mac, Ipod, Iphone, Ipad, Apple watch…about to set-up company in Vietnam to promote and distribute its own products i.e. the upcoming Iphone 6s, and Iphone 6s plus?

According to the information from the official dealer of Apple in Vietnam, Apple has already had a representative in Vietnam and began contacting with agents in the country from early 2015. The current business activities of Apple with domestic partners are done through Apple Thailand. Therefore, Apple’s representative in Vietnam will help to smooth out this arrangement because of the better understanding the local market and no language barrier.

Although Apple has not had their representative office or official company in Vietnam but they have many authorized dealers to sell its products. Apple products like the iPhone 6 and iPhone 6 Plus have always led the top 10 selling phones in many domestic retail systems since its launching in late 2014. According to the statistic of IDC, in the first quarter of 2015, Apple ranked 2nd in value in the largest smart phone manufacturers in Vietnam; in the tablet market, Apple accounted for 16.6% of the market – ranked 2nd in the market – but accounted for 29.1%, the highest in terms of market value.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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Benefits of Setting Up Company in Ho Chi Minh City

set-up company in Ho Chi Minh City

Ho Chi Minh City is considered as Vietnam’s economic hub. During the long history of foundation and development, the city’s economy is growing constantly and motivating the development of the country.

The city is therefore considered as a potential investment environment for domestic investors as well as foreign investors. The investment through establishing companies and conducting business activities in Ho Chi Minh city certainly promises to achieve multiple benefits. These benefits come from the following reasons.

First, Ho Chi Minh City has strategic location advantage in Vietnam. Southeast Asia Region, Ho Chi Minh City is 1,700 km south of Hanoi, 297 km east of Phnom Penh, Cambodia, 881 km east of Bangkok, Thailand.

Food, glass, textiles, paper products, plastics, chemicals, building materials and machinery are produced here. Ho Chi Minh City accounts for 20% of total gross domestic product (GDP), 30% of industrial production and 40% of export products of Vietnam. The city also accounts for 33% of the national budget and 60% of foreign investment flows into the region. In the past few years, the economy have been grown at a rate greater than 10% (6% to 8% nationally).

Second, Ho Chi Minh City is home of well – qualified, abundant and young human resources.

With a population of more than 8 million, accounting for more than 10% of the total Vietnamese population, Ho Chi Minh City itself has potential employment market to make any business investment. The work force in Ho Chi Minh City was estimated to reach 4.7 million people in 2012, making up more than 50% of the total population of the city. The percentage of trained labor increased from 40% in 2005 to 55% in 2010 and was forecast to reach 70% in 2015. The percentage of labor source holding postgraduate degree is also increasing year by year and most of them tend to stay in the city after holding degrees. Ho Chi Minh City is also home to more than 80 universities and colleges, vocational schools with over 400,000 students providing an abundant trained work force.

With the above – mentioned abundant labor force, any companies set up in Ho Chi Minh City can easily recruit suitable employees in a short time..

Third, the city has modern and high infrastructure system. Namely, when setting up company in Ho Chi Minh City, the owners will benefit from the modern and comprehensive infrastructure system.

Tan Son Nhat Airport is the largest airport in the country with the capacity to accommodate 20 million people a year. From Tan Son Nhat Airport, there are 50 routes to other countries all over the world such as China, Japan, Korea, Singapore, European countries, etc.

Saigon Port serves as a gateway to the Mekong River Delta, the South China Sea (83 km away from the sea) and the Asia continent. The port has a total area of 500,000 m2 with 5 terminals meeting the international standards, and it handles about 8.3 million tons of cargo annually. Throughout the history of foundation and development of Saigon, Saigon Port plays an important role in making Ho Chi Minh City a flourishing trading center. It accounts for a fifth of the nation’s Gross Domestic Product and almost a third of its industrial production.

Ho Chi Minh City is also home to industrial zones. According to the statistics of Cushman & Wakefield, the city has 18 industrial parks that are operating with a total area of 3635 ha. When investing in such industrial zones in Vietnam, enterprises can benefit from various incentive policies such as low rate tax or other incentive policies.

Telecommunication and information technology in the city is modern. The system of post and telecommunication in Ho Chi Minh meets international standard, providing fast, reliable and high quality services such as ADSL, rapid data transfer, wide broadband MAN. The Internet service in Ho Chi Minh city is also among the cheapest in the world.

Besides, the city is also considered the best working conditions. Enterprise will not be fear that it is not enough place for working. The city with the system of offices provide ideal working environment for all investors.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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New Billion Dollars Thermal Power Project in Vietnam

Energy consultant in Vietnam

Recently, Vietnam is really blooming with a lot of renewable energy projects as many foreign investors choose to set up business in Vietnam in this field.

The Nam Dinh 1 thermal power project, with a total investment capital of 2.2 billion USD, is the largest thermal power project in Nam Dinh so far. The project owner is Nam Dinh 1 Power Co., Ltd but headquartered in Singapore and is a joint venture of two foreign corporations which are Taekwang Power (Korea) and Acwa Power (Saudi Arabia).

Taekwang Power is expanding its portfolio in areas as real estate, petrochemicals; at the same time continuing to increase investment capital in Southeast Asia. In 2008, Taekwang Power established its subsidiary Taekwang Power Holdings to participate in the development of power plants in Vietnam.

Meanwhile, Acwa Power was established in 2004 as a joint venture between Abunayyan Trading Company and Abdulkadir Al Muhaidib & Sons Company together with MADA Group. Acwa Power is trading in power supply and desalination, and is the first private company to operate in this area after Saudi Arabia decided to strengthen its role in the private sector in 2002.

The total investment capital of the Nam Dinh Power Project includes: owner’s equity is 0.56 billion USD, accounting for 25% and loan is 1.68 billion USD, accounting for 75%. The commercial operation date is scheduled for December 2020 with a BOT contract term of 25 years.

The two companies in the joint venture of Acwa Power and Taekwang Power are large and experienced organizations in the field of power generation and supply. Taekwang Power with its subsidiary Taekwang Power Holdings specializes in the field of power supply. Meanwhile, Acwa Power owns a lot of domestic and international power generation and supply projects, especially 10 projects using renewable energy.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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Invest in Real Estate of Vietnam in 2016?

Invest in real estate in Vietnam

The real estate market in 2016 will continue to recover. Vietnam real estate sector had signs of recovery in late of 2013 and lasted until 2015. Up to now, there were not any signs showed that development flow will be slowed in 2016.

In general, as recorded, real estate price is increasing and the actual increase amplitude ranging from 5 – 15%, certainly not with every market segment and every project. According to experts, the price increasing is also consistent with the rule that the market is starting to come up from the bottom but not yet peaked.

If we look at the profit of the real estate businesses in 2014, businesses that operated efficiently in 2014 have achieved profit in the range of 5 – 15%. In 2015, the number has increased to 15 – 20%. However, a common project construction time is about 3 – 4 years so the profit margin is not too high. Compared with the period of the real estate bubble, this is still sustainable growth rate.

Also in 2016, the property was evaluated as a safe investment channel and promising to create added value. If the national economy continues to grow, along with a series of extensive integration opportunities that we are, can hope 2016 will form the opportunity to create added value for real estate Vietnam.

The important thing is the final price when reaching home buyers is still in the acceptable range. According to the real estate consultants, if buyer has financial capability, they should buy or invest in real estate right now because the price in the next year is likely to rise.

In 2016, real estate is evaluated as a safe investment channel and promising to create value added. If the national economy continues to grow along with a series of extensive integration opportunities that Vietnam had, it is hoped that 2016 will form many opportunities to create value added for Vietnam real estate market.

When investing in real estate market at this time, investors can easier to buy at cheaper price and more options. Market supply is abundant only with the apartment segment with prices more than 20 million VND/m2, while the segment with prices below 20 million VND/m2, there are not enough houses to sell to buyers.

There are many projects that products are sold out within a month. Hence, small and medium class segments are having greater certainty and especially never being affected by the financial crisis. It also demonstrates two issues: consumer confidence has begun to return to Vietnam real estate market and real estate market of Vietnam always have really secure segment.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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Vietnam Technology Startup Attracts Foreign Enterprises

Buy a company in Vietnam

Technology startup in Vietnam is increasingly attractive. Many foreign enterprises are interested in this area and showing their desire to set up business in Vietnam.

According to Mr Mitchell Pham, president of the New Zealand Technology Association (NZTech) – who is known to be the 1st native of Vietnam elected to become the chairman of NZTech, representing for over 400 technology enterprises New Zealand: “All trip participants were impressed with the development of science and technology in Vietnam. We are looking for specific opportunities for cooperation with Vietnam-tech enterprise”.

More information about the members of the delegation, Mr Mitchell Pham said that back to Vietnam this time, accompanied him are 6 young leaders of technology enterprises in New Zealand with a desire to learn and exchange with technology businesses in Vietnam, in order to create connection for long-term investment goals.

In terms of the favorable conditions, according to Mr Mitchell Pham, trade relations between New Zealand and Vietnam have the fastest growth rate in Southeast Asia with 120% in the period 2010 – 2015. Two-way trade of the two countries in 2015 has reached 1 billion USD.

Moreover, Vietnam is known as the country with the booming information technology market and the government is also trying to create more incentives for this sector. Meanwhile, technology businesses in New Zealand have experiences and large operating network, certainly the cooperation and investment in Vietnam will be intensified in the coming period.

According Chicilon Media, Vietnam technology market, especially Ho Chi Minh City is developing extremely powerful. Consumers is having trend to access to communication products and services via smartphones instead of traditional media such as TV, poster… Hence, this Company has strengthened their strategy focusing on channels to access information over the phone and access to a diverse range of partners such as the startup.

In parallel, the growth of mobile devices will continue in the coming years. Therefore, the approach to the users of mobile devices – who are moving to the final stage of the shopping journey and going to buy the product – becomes extremely important. Currently, marketing on mobile devices is evaluated as a simple marketing channels, rapid deployment and easy to access to customers.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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M&A Due Diligence and Execution in Vietnam

M&A Opportunities in Vietnam

Merger and Acquisition (M&A) activities in Vietnam have been rapidly increasing over the the years in value and number of transactions when Vietnam’s opening policies to attract foreign investments loosen up. The M&A due diligence and execution are therefore important steps to ensure a successful transaction.

For foreign investors wishing to take advantage with a certain level of risks in Vietnam where the cost of labour are cheap, mid-income populations are growing, and the need of capital are high, it is imporatant to find the right target companies to invest. Challenges might arise when approaching the right local companies, locating the right decision makers within the local companies, encountering differences in languages and cultures.

It is imporant that the local consultants with the understanding of the business and legal environment in Vietnam where the local companies are incorporated could be involved at an initial stage to monitor and minimize the risks, improve the effectiveness of the M&A process in Vietnam.

The Vietnam consulting company could also provide corporate intelligence and insights of the Vietnam targeted companies to have an overall evaluation of the compliance of the Vietnam companies, possible risks involved and growth potential. Financial forensic services might also be needed before other further steps. Then, the following will need to be considered when undertaking the M&A in Vietnam.

Due diligence

M&A due diligence in Vietnam is a vital step because it determines whether the M&A will succeed or not. There are some aspects that must be carefully considered:

Financial reports

Review all the financial reports of the Vietnam targeted companies within 3 to 5 years to assess the current and future financial situation. These data needs to be audited by a reputable independent auditing company. Evaluating financial situation targets on many aspects such as the reasonable connection between the financial statements, operating and sales margin of the business in relation to the average in that industry. These data allow valuation real value of the target business.

The cash flow

Checking the dates on invoices showing that whether targeted businesses have paid promptly or not. Term of payment may vary from industry to industry, but generally 30 to 60 days. If the money order is paid after the billing date period of 90 days or more, it means that the business owner may be struggling with cash flow. Finding out that if the clients’ inability to pay bills or not is very important.

The staff

Determining the importance of staff for the success of the business considering work habits of employees, working time of key employees; ability to remain working after a change of the owner occurs; the incentives necessary to keep key employees; ability to easily replace key employees; the relationship of key employees with the company’s customers.

The customers

This is the most important assets of the Vietnam targeted company. Make sure that clients are as the other tangible assets of the business. Evaluating customers on some primary aspects: the relationship with the current owner of the business, customer history with business relations and the contribution of each customer to the profits of the company; assessing that customer will leave or stay when the business having new owners; customer services and dispute of the company, the relationship of the former owner of the business with the community or the industry.

Business location

This is especially important if the targeted company is a retail company. Does the importance of business location play a crucial role for the success of the company? How is the location of the company you plan to acquire? Is there sufficient parking lot for customers? How does the company depend on sales in the region? How is the prospects of the business in this area? Does this place have been in the process of rapid change from new residential district office building or not? Has business location become more or less desirable because of contemplated changes in surrounding area or not?

Competitors

Considering this aspect in order to define the capacity of the targeted business in the industry, the following questions would help: who are its competitor and what are their strategies? Does the price war happen frequently? How has the competitive environment changed?

Business registration, permits and zoning

It’s necessary to make sure that business registration certificate and other legal documents can be easily given to the buyer. It would be better to acknowledge the procedures to transfer these documents and its fee with the help of local management consulting company in Vietnam. If the targeted company is a joint-stocks company, what is the procedure for the business registration? Can foreigners own the company 100% according to Vietnam laws? Conditional investments in Vietnam need to be considered carefully by lawyers in Vietnam to avoid mishaps.

The company image

Company image can be a significant asset and that cannot be assessed in the financial report. There are many intangible factors to consider when evaluating a company: how to serve customers, how employees answer the phone and the level of support the community or the industry.

Negotiate the price

It is important to understand the purpose and motivation of both parties. The sellers’ motivation are formed and affected by value drivers. There are two main value drivers which are approach value and avoidance value. Approach value is our purpose such as prosperity and avoidance value is the negative effect that we need to eliminate. Normally, the buyers try to find out what are the reasons why the owner wish to sell the companies. This will help the buyers plan a reasonable strategy beforehand.

A research analyzes the general aspects that the buyers seeking for via conducting surveys companies’ owner who have sold or transformed their enterprises. The research results are focus on profit maximization (79%), minimization of tax payable (73%), protection of viability of the company (71%)…(Source: Acquisition Marketplace Review, 2007).

The motivation of the buyer in most cases is similar to the motivation of the seller, which is to maximize profits, expand markets, increase revenue, operating areas, areas of activity, minimize taxes…

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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Hanwha Techwin Company (Korea) Wants to Invest in Bac Ninh

set-up company in Bac Ninh

Vietnam has always been an ideal investment destination for many foreign companies to come and set up business in Vietnam.

Currently, Mr. Yang Jin Seol, CEO of Hanwha Techwin Company (Korea) came to Bac Ninh to survey and explore the investment environment in Bac Ninh province.

Working with the Chairman of Bac Ninh Province, Mr. Yang Jin Seol said that Hanwha Techwin Company (under Hanwha Group) is specializing in producing security devices with 27 networks globally. Turnover of the Company in 2015 reached nearly 600 million USD.

Through survey and research, the Company is expected to invest in building factories in Que Vo Industrial Zone with a total investment of 50 million USD, in which the first phase (2017-2019) is 30 million USD. When put into operation, the plant will create jobs for about 1,500 – 2,000 labor, with capacity of 2 million pieces/year.

Mr. Yang Jin Seol hopes that the company’s business ideas will be interested and the provincial leaders will create favorable conditions, especially the preferential policies for enterprises producing high-tech products so that the Company can early implemented the plant construction in the first quarter of 2017.

The Chairman of Bac Ninh province welcomes Hanwha Techwin Company have trusted and choose Bac Ninh as investment destination to invest in stable and long-term production. He also assigned the Management Board of Industrial Zones in coordination with the Kinh Bac Urban Development Corporation – the infrastructure investor of Que Vo Industrial Park and other offices complete the legal procedures and creating all necessary conditions for the project of Hanwha Techwin Company.

Bac Ninh is one of the leading provinces in attracting FDI with nearly 1,000 projects with total registered capital of over 12.26 billion USD. South Korea has more than 400 projects, accounting for about 50% of total FDI capital of the whole province, in which there are many projects of large companies such as Samsung, Orion, Daewoo, Flexcom, Intops, Nano Tech…

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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SCG (Thailand) Pours Capital into Vietnam Petrochemical Sector

Energy market in Vietnam

With the acquisition of 25% shares from Qatar Petroleum at Long Son Petrochemical Refinery Complex project, SCG Group (Thailand) continues to strengthen its position as a major investor in Viet Nam petrochemical sector.

Previously, Vina SCG Chemicals (VSCG), a wholly-owned subsidiary of SCG in Vietnam, has signed contract to acquire shares of QPI Vietnam Limited (QPIV), a subsidiary of Qatar Petroleum to receive all 25% shares in Long Son Petrochemical Co., Ltd – the investor of Long Son petrochemical complex, according to a press release posted on SCG’s website.

This 36.1 million USD deal (approximately 1.100 million Thai bath), which raised SCG’s direct and indirect shares in Long Son Petrochemical Co., Ltd from 46% to 71%. Meanwhile, the remaining 29% of the joint venture to develop this project is held by PetroVietnam (PVN).

This project is a major oil and gas project, the first petrochemical complex in Vietnam with production capacity of up to 1.6 million tons of olefins per year, total investment estimated at 5.4 billion USD, applying modern and advanced technologies and techniques, operating safely and meeting the requirements of environmental protection, ensuring high quality petrochemical products such as PP, PE…

The project will create about 15,000 – 20,000 jobs during construction and more than 1,000 jobs when go into commercial operations.

Moreover, the project is estimated to contribute to Ba Ria – Vung Tau and the national budget 115 million USD per year (about 2.5 trillion VND per year) during 30 years since its inception.

The successful negotiation and signing of documents and transfer of funds among partners are important milestone in the project implementation, ensuring that the project is put into operation by 2021.

The Siam Cement Group (SCG) is a leading corporation in the ASEAN region with many efforts to establish competitiveness in the global market. SCG has entered the Vietnam market since 1992.

SCG has also invested heavily in Vietnam in such core business lines as: construction materials, petrochemicals and packaging. In addition to direct capital inflows, in recent years, SCG has also expanded its investment in Vietnam through mergers and acquisitions (M&A).

SCG’s companies in Vietnam are mainly operating in the fields of cement – construction materials, chemicals and packaging. By the end of 2016, total assets of SCG in Vietnam are about 943 million USD.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 3520 2779 or email us ant@antconsult.vn

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