[Vnbiz] Intel, US finance group buy into Vietnam IT leader

[Phan, Tai]

Intel, US finance group buy into Vietnam IT leader Tue Oct 24, 2:42 AM ET
 


HANOI (AFP) - Vietnam's leader in information technology FPT has said it has sold shares worth some 36.5 million dollars to US chip giant Intel and private equity firm Texas Pacific Group. 

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FPT Corp. said the deal with Intel Capital, the venture capital arm of Intel Corp., and TPG marks "one of the largest cross-border investments into Vietnam by leading global investment firms, underlining the long-term confidence that institutional investors have in the country.

"We believe this deal underscores the potential and capabilities within Vietnam and is a milestone in the country's efforts towards joining the World Trade Organisation," said Truong Gia Binh, chief executive officer of FPT.

Details of the two Intel Capital and TPG's respective investments were not immediately available.

The IT market in Vietnam has been growing 20 percent annually and is now worth more than 800 million dollars, an FPT statement said.

Vietnam, with a highly literate population of more than 83 million, two-thirds of them aged under 30, is already Southeast Asia's fastest growing Personal Computer market.

The number of Internet users in Vietnam is above 13 million and the number of mobile phone users is growing the fastest of any country in Asia-Pacific.

FPT reported 2005 revenues of more than 517 million dollars and has recorded average 70 percent annual growth over the past five years.

It is the Vietnamese market leader in mobile phone distribution, systems integration, software outsourcing and development, telecom, Internet and e-media content and computer assembly.

Last February, US chip giant Intel said it would build a 300-million-dollar semiconductor assembly and test plant in Vietnam. Another equivalent investment would follow in a second phase.

The move was hailed as boosting Vietnam as a global investment destination, bringing jobs and technology know-how, and potentially attracting other hardware and software companies to follow suit.

"We see strong prospects for Vietnam's IT sector and look forward to making a contribution to Vietnam's success through support of fast-growing companies, such as FPT," said Arvind Sodhani, president of Intel Capital.

Vivek Paul, a partner with TPG who will serve as special strategic advisor to FPT, said the communist nation was on track for sound and steady growth.

"Vietnam has the second-highest annual        GDP (Gross Domestic Product) growth rate in Asia-Pacific, behind only China, a literacy rate of over 96 percent, a rapidly growing middle class and a government committed to economic reform," he said.

"These are all key building blocks that allow a country to compete globally."