South Korean supermarket chain E-mart is to exit its Vietnam business, with reports suggesting it will be sold to local car manufacturer Truong Hai Auto Corporation (Thaco Group).

According to The Korea Times, E-mart announced earlier this week that it will sell E-mart Vietnam to Thaco Group. However, a spokesperson of Thaco said the group has not signed any agreements with the South Korean firm. 

E-mart has spent five years trying to establish a footprint in Southeast Asia, but in Vietnam had managed to open only one store, a second suspended due to local licensing setbacks. 

A South Korean media report said E-mart would take royalty fees from Thaco Group and its supermarket will be run as a franchise. 

“Our strategic alliance with Thaco will not only pay us royalties for using the E-mart brand in Vietnam, but also give us the opportunity to export our private-brand products,” an E-mart employee told The Korea Times. 

Predictions that the South Korean supermarket chain would exit Vietnam arose last year. However, its representative then denied the news and said it was looking into other options such as a strategic alliance or business partnership.

Thaco Group’s commercial-services arm includes managing and operating mix-used business models including shopping malls, hotels and developing business lines such as supermarkets, food courts and cinemas. 

The group is currently operating businesses at Yangon Myanmar Center Complex in Myanmar and building its Socar Sala mixed-used complex in Ho Chi Minh City’s District 2.