South Korean government-owned Korea Water Resources Corporation ( K-water ) has entered the Vietnamese water market by acquiring a 30% stake in Phu My Vinh, a water company in Long An province, Vietnam, from Malaysia-based RBC Water for 87.14 million ringgit ( US$20.58 million ).

The Korean firm, which has an eye on regional expansion, signed a share transfer contract with RBC, which will divest its holdings in Phu My Vinh.

The deal marks K-water’s full-scale entry into the Vietnamese market. With its new holding in the Vietnamese firm, the company will participate in the operation and management of waterworks facilities in Vietnam for 39 years, from this year until 2063. The company plans to use its Smart Water Network Management technology on a trial basis first before pursuing further expansion plans.

K-water also plans to establish a strategic cooperation base to expand its entry into the Southeast Asian water market.

Prior to the share acquisition, K-water had been present in the Vietnamese market as a water industry expert through South Korea’s official development assistance projects related to water supply in the northern province of Hoa Binh.

Phu My Vinh was established in 2005 and is supplying water to industrial complexes and individual companies in Long An province bordering Ho Chi Minh City. The company now supplies 300,000 cubic metres of water per day, and is operating Viet Hoa-Duc Hoa Industrial Park in the province as the owner. Additionally, the firm is building Vam Co Industrial Park also in Long An.

“Vietnam is a strategic market with high growth potential in the water market due to its steep economic development,” says Ahn Jeong-ho, K-water’s head of green infrastructure. “This share acquisition will serve as an important starting point for K-water’s entry into new global water markets, establishing a bridgehead for expansion into the Southeast Asian market, building a foundation for exporting Korean smart water management technology, and leading the joint overseas expansion of the domestic water industry.”