Emart Sells Partial Stake in Vietnam Subsidiary... Transition to Franchise Model

Vietnam Corporation Explores Partial Stake Sale to Local Distributor
Maintaining 'Emart' Brand

[Asia Economy Reporter Cha Min-young] Emart is converting its large-scale mart business model, which it operates independently in Vietnam, into a 'franchise model.' Currently, Emart operates one store in Go Vap, Vietnam.

According to the industry on the 8th, Emart has selected Samjong KPMG as an advisor and is exploring ways to sell part of the shares of its local Vietnamese subsidiary. Emart Vietnam is a 100% subsidiary of Emart. Selling part of the shares to a partner company and converting the business model into a franchise model, as in Mongolia, is being actively considered.

After opening its first store in Go Vap in 2015, Emart considered opening a second store, but expansion was hindered due to government regulations. The total assets of Emart Vietnam at the end of 2019 were 139.2 billion KRW, with last year's sales and net profit recorded at 62.9 billion KRW and 1.2 billion KRW, respectively.

Emart entered China in 1997 and once operated nearly 30 local stores, but due to poor performance and the adverse impact of the Terminal High Altitude Area Defense (THAAD) system, it withdrew all stores in 2017. In 2016, Emart entered Mongolia and currently operates three stores. It exports its brand and store operation consulting to Sky Trading of the local distribution company Altai Group, and Emart receives royalties under a franchise system.

An Emart official explained, "Emart Go Vap store is a highly profitable store competing for first and second place in sales among local large marts," adding, "Due to strict government regulations, after reviewing business feasibility since entering Vietnam, we decided to change direction in this way."

This content was produced with the assistance of AI translation services.