Vietnamese private conglomerate Vingroup has agreed a long-term equity and commercial partnership with French-based mobile device manufacturer Archos. Under the deal, up to 60 percent of Archos’ share capital could be controlled by the Vietnamese group, through its smartphone subsidiary VinSmart. This follows the recent acquisition by Vingroup of a majority stake in Spanish handset manufacturer BQ, in line with its ambition to expand in the European consumer device sector.
Archos’ board of directors approved the financial details of the transaction on 26 April. The company will issue 27,460,000 new shares to VinSmart, at a price of EUR 0.2811 per share, alongside 71,000,000 share subscription warrants, each giving right to one ordinary Archos share. The warrants can be exercised over a 2-year period, with an exercise price per warrant equal to EUR 0.281.
Subject to a number of conditions, the share issue should represent up to 29.5 percent of Archos' share capital. If VinSmart exercises all the warrants, the Vietnamese group will increase its stake in Archos to 60.0 percent.
Alongside this equity deal, the two parties have agreed a strategic partnership that will see the French company benefit from VinSmart’s manufacturing and R&D facilities. In turn, Archos will become a distributor of VinSmart products in Europe, selling all future smartphones in this market under the ‘Vsmart’ brand.
