The water industry is set to witness a flood of M&A in the near future as many big players plan to stretch out in the southern region.

The Binh Duong Water Environment JSC (Biwase), a prominent name in the water industry, has approved a plan of acquiring stakes in five companies operating in the water and environmental sanitation sectors in Long An and Quang Binh provinces.

They are DNP - Long An Water Infrastructure Investment Joint-Stock Company, Chau Thanh Urban Construction Joint Stock Company, Can Giuoc Urban Project Joint Stock Company, Bang Tam Water And Environment Corporation and DNP Quang Binh Water Infrastructure Investment Joint Stock Company.

In the above list, there are three companies under the umbrella of DNP holding, formerly known as Dong Nai plastic, namely DNP - Long An Water Infrastructure Investment Joint-Stock Company, DNP Quang Binh Water Infrastructure Investment Joint Stock Company and Chau Thanh Urban Construction Joint Stock Company, with ownership rates of 87.98%, 89.9%, and 96.06%, respectively.

Of them, DNP - Long An Water Infrastructure Investment Joint-Stock Company, having a charter capital of 786.29 billion VND, owns Nhi Thanh water plant with a designed capacity of 60,000cu.m per day and night, supplying clean water to many areas in the southern province of Long An.

DNP holding currently has 15 factories producing plastic and clean water, with a total capacity of plastic products of 8,500 tonnes per month and 700,000cu.m of clean water per day.

Thus, Biwase mainly acquires water supply enterprises in DNP holding's ecosystem to expand its operation area towards the southern area.

In 2022, Biwase invested a total of 294 billion VND in purchasing shares of two companies, namely Can Tho Water Supply and Sewerage JSC and Can Tho 2 Water Supply JSC. This move has increased the number of Biwase affiliates in the water industry to four, with total investment reaching 768 billion VND, accounting for nearly 8% of Biwase’s assets. The company’s M&A plan for this year shows its ambition to expand its scale through M&As.

With the ambition to become a leading enterprise in the field of water supply in the South, Biwase continues to acquire companies in the same industry in the southern provinces of Long An, Binh Phuoc and Ben Tre.

Dong Nai Water Supply Joint Stock Company plans to purchase 2.5 million shares of Gia Tan Water Supply Joint Stock Company, at the price of 4,000 VND per share, with expected time in the first and second quarters of 2023.

As of December 31, 2022, Đồng Nai Water Supply owns 25% of capital in Gia Tan Water Supply, equivalent to an investment value of 50 billion VND.

The Gia Tan Water Supply was established on November 1, 2016, headquartered in Dong Nai, mainly operating in the field of exploiting and filtering water for daily life, urban and industrial purposes, installation of pumping stations, and construction of water supply pipelines. The legal representative includes Chairman of the Board of Directors Hoang Anh Tuan and General Director Nguyen Van Thien.

Notably, Nguyen Van Thien is also the Chairman of the Board of Directors of Biwase, which owns 31.52% of capital in Gia Tan Water Supply.

The Thu Dau Mot Water Joint Stock Company owns 37.42% of charter capital in Biwase, owns 20.9% of capital at Gia Tan Water Supply and owns 12.06% of Dong Nai Water Supply.

Thus, Thu Dau Mot Water is a cross-owner of many water supply enterprises in Dong Nai and Binh Duong, through direct or indirect ownership through Biwase. Thu Dau Mot Water was established in 2013, with the main business being clean water business, and currently has a charter capital of 200 billion VND.

It can be seen that Biwase's ambition is also Thu Dau Mot’s ambition, which is to dominate the market share of water supply in the southern provinces.

Biwase currently has charter capital of 1.93 trillion VND, equity of 4.53 trillion VND, and total assets of 9.99 trillion VND. In 2022, the company recorded consolidated revenue of 3.48 trillion VND, consolidated profit after tax of 742.7 billion VND, equivalent to basic earnings per share of 3,195 VND.

Thu Dau Mot Water currently has a charter capital of 1 trillion VND, equity of 2 trillion VND, and total assets of 2.40 trillion VND. In 2022, the company achieved consolidated revenue of 478.9 billion VND, profit after tax of 220.4 billion VND, equivalent to basic earnings per share of 2,028 VND./.