VinaCapital invests in Vietnamese wind farm(3)

The Vietnam-based firm has taken a 25 percent stake in the Thuan Binh Wind Farm Company, which is backed by the Vietnamese government.

VinaCapital has invested an undisclosed sum for a 25 percent stake in the Thuan Binh Wind Farm Company.

Backed by the Vietnamese government, the company is developing the Thuan Binh Wind Farm, located on the country’s Southeastern coast. The wind farm requires approximately $60 million for the first phase of its development, which is 30 megawatts of installed capacity. It expects to be operational by the second half of 2010. Developed in three phases, the project aims to produce up to 170 megawatts when it is completed in the next three to five years.

The investment, which was made out of the firm’s balance sheet, will be used to purchase and install equipment, as well as arrange the site’s lease, according to William Lean, a VinaCapital managing director.

“Vietnam has a 300 kilometer coastline facing the South China Sea so the potential for wind power is huge and is presently untapped,” he added.

Separately, VinaCapital listed industrial park investor and developer Binh Chanh Construction, on the Ho Chi Minh City stock exchange.

In early 2008, the firm had invested an undisclosed sum for a minority position in the company. The investment was made out of the UK-listed Vietnam Infrastructure Fund. Binh Chanh Construction’s listing resulted in a more than 30 percent increase in the value of the firm’s stake, according to Lean.

“There is a great demand for industrial parks in Vietnam as the country enjoys significant labour cost advantage over China. In fact, we foresee a lot of factories relocating to Vietnam in the current economic climate. Lean and mean is in,” said Lean.

VinaCapital intends to raise its fifth fund by the end of 2009. The fund will be an unlisted, closed-end energy fund focused on Vietnam, according to sources.

The firm’s other three funds include Vietnam Opportunity; VinaLand; and DFJ VinaCapital Technology Fund, a $35 million unlisted venture capital fund.