The Singapore Exchange announced that it will purchase 22% of Eurocapital Joint Stock Company’s issued share capital

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TMW Maxwell showflat location

Real estate service provider APAC Realty, the operator of the ERA brand, is expanding their stake within ERA Vietnam to 60% from the initial 38% stake it acquired in February of 2020.

The Singapore Exchange (SGX) Mainboard-listed company also announced on January 9 that it will acquire 22% of the shares issued capital Eurocapital Joint Stock Company.

Eurocapital serves as the sub-franchisor for the ERA brand to ERA Vietnam. APAC Realty has, in its turn, granted Eurocapital the permission to sub-franchise ERA brand.

TMW Maxwell showflat location will benefit from the planned rejuvenation of Tanjong Pagar and the planned developments of the Greater Southern Waterfront precinct.

Following the completion of the transaction, APAC Realty will increase its stake following the transaction’s completion. ERA Vietnam and Eurocapital to 60% each.

The total amount payable for the upfront payment totals $4.9 million and includes an earn-out reward that could reach $10.5 million. “The earn-outs were arranged to encourage sellers to reach their goals of performance and to further boost the success and growth that are the hallmarks of ERA Vietnam and Eurocapital,” APAC Realty. APAC Realty.

The figure for earn-outs, $2.8 million is subject to certain conditions, and based on the revenues and net income earned through ERA Vietnam and Eurocapital from July 1, 2023 until June 30th 2024. In addition, $7.7 million as an incentive to earn out is scheduled to run beginning January 1st, 2025 through December 31st 2025.

APAC Realty had invested $1.5 million to acquire 38% stake in ERA Vietnam in February 2020. In the 4Q2020 period the Group also provided an investment of $1 million to help expand.

With the deal, APAC Realty plans to extend an equity loan worth $1.5 million for ERA Vietnam. As per APAC Realty, the loan proceeds will be used to help the expansion plans of ERA Vietnam’s its operations and ensure the launch of new projects and gain market share.

ERA Vietnam has the right to draw down the loan in accordance with the date of agreement until June 30th 2023. The loan is due to mature five years after the date of drawdown with five% annually interest.

The six-month period which ended on June 30th, 2022 ERA Vietnam posted net profit of $0.1 million and revenues of $5.5 million. Eurocapital posted an operating loss of $0.03 million and a revenue of $0.4 million during the same time frame.

The acquisitions are expected to drive expansion of the business in Vietnam and will consolidate the ERA brand in the region, and help promote cooperation across the different subsidiaries of the group and affiliated enterprises across Southeast Asia, says APAC Realty. The increased stake of the company will allow it to integrate both ERA Vietnam and Eurocapital in its financial statements, the company says.

Vietnam CEO reduces stake by 15%
The buyers in this deal include Pham Thanh Tuan Pham Thanh Tuan, director from ERA Vietnam; along with Vu Duy Khuong, Vu Duc Hieu, Vu Trung Phong, Tran Dong An and Tong Nam Tran.

Pham has sold the equivalent of 4% out of the 19% stake, which means that the shareholding after purchase would be fifteen% for the two companies, ERA Vietnam and Eurocapital. Pham has therefore retained the majority of his share in ERA Vietnam and Eurocapital.

After the acquisition the remaining 25% of each of ERA Vietnam and Eurocapital will be owned through KTP & Partners Joint Stock Company. KTP is an investment-holding firm and has contributed to ERA Vietnam’s expansion and progress since its beginning APAC Realty. APAC Realty. “KTP is a strategic local partner who will help support the Group’s strategies in the Vietnam real property brokerage market moving forward.”

Established in 2017, ERA Vietnam is based in Ho Chi Minh City. Under the direction of Pham the agency has expanded its base of agents from just more than 1,500 salespeople as of December 31, 2020, to close to 3,900 salespeople by December 31 2022.

In its FY2023 pipeline ERA Vietnam has secured marketing obligations for 23 new homes that total 6,460 units, according to APAC Realty.

“The capital for growth that was lent through our first purchase was the trigger that drove ERA Vietnam’s massive expansion over the past two years in terms of sales and headcount of agents,” says Marcus Chu the chief executive officer for APAC Realty. “We believe that our investment in the second round will help ERA Vietnam’s next phase of growth , and help us to realize greater benefits in the eyes of APAC Realty shareholders over the long-term.”For its 2023 pipeline Era Vietnam has already secured marketing mandates for 23 brand new homes that total 6,460 units. This includes the 9 Stellars by Sonkim Land, Zeit River Thu Thiem by GS E&C, Cadia by Phat Dat, iD Junction by Tay Ho as well as Grand Marina Saigon by Masterise.

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