Phat Dat Real Estate Development Corporation’s (PDR) acquisition of a 35% stake in South Korea’s Lotte Properties HCMC for around VND7.66 trillion (USD291 million) was advised on by YKVN and Shin & Kim. The acquisition is part of PDR’s investment in the development of Lotte Eco Smart City Thu Thiem, a large-scale mixed-use urban project in the Thu Thiem New Urban Area in Ho Chi Minh City.
The project involves total investment of around VND60 trillion, covering a mix of residential, commercial, office, hospitality and public space elements. YKVN advised PDR on all aspects of the acquisition, including structuring, due diligence, documentation and completion.
Managing partner Truong Nhat Quang and partner Vu Mai Tram led the YKVN team, who had the support of senior associate Ha Nguyen Nhat Minh and associate Le Pham Viet Han. According to the filing, PDR intends to inject an additional VND2.7 trillion to preserve its 35% ownership stake if Lotte Properties HCMC raises its charter capital to VND12 trillion.
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Vu Mai Tram noted that the regulatory and compliance advice included the capital-transfer requirements under the Investment Law and the Law on Enterprises. They also advised on the corresponding amendments to the target company’s investment registration certificate, enterprise registration certificate and other project documents.
The main challenge was reconciling commercial objectives with the Land Law, in particular the rules governing capital-contributing partners in residential projects. Ensuring that the accounting, governance and exit mechanics were both commercially robust and enforceable under Vietnamese law was also a challenge. Co-ordinating a cross-border transaction involving Korean-affiliated counterparties across multiple execution documents added a further layer of complexity.
Shin & Kim advised Lotte Group throughout the transaction, providing support on regulatory reviews, leading negotiations with the Vietnamese government, and preparing and negotiating the agreements between Lotte Group and external investors. Managing partner of the Vietnam branch Yeongmin Gil was part of the team, alongside partner Ji-Hwan Park, and foreign attorneys Phan Tung Anh Tuan and Dinh Hoang Minh Ngan.
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The partnership between PDR and Lotte Group could shape future cross-border co-operation in the real estate sector. The Lotte Eco Smart City Thu Thiem development is projected to involve total investment of around VND60 trillion, covering a mix of residential, commercial, office, hospitality and public space elements.
Shin & Kim resolved the primary legal hurdle by leveraging newly amended regulations to construct a favourable legal argument, allowing Lotte to successfully negotiate with regulatory authorities to permit the external investment, according to Yeongmin Gil.
Yeongmin Gil said the partnership between PDR and Lotte Group could shape future cross-border co-operation in the real estate sector. “The partnership between these leading South Korean and Vietnamese enterprises is anticipated to synergise and serve as a benchmark for cross-border co-operation in the real estate development sector. Furthermore, by securing external investment, Lotte Group has successfully raised new capital, ensuring the necessary liquidity to advance the project,” Gil said.
