PE in Emerging Markets: Can Mekong Capital's Operating Advantage Boost the Value in its Exit from Golden Gate Restaurants?

Mekong Capital, a private equity firm based in Vietnam, is considering exiting its stake in restaurant chain operator Golden Gate. Despite robust growth, Golden Gate’s profitability is lagging. Students are asked to evaluate the best means of exit and whether operational improvements are required to attract buyers or create the foundation for a successful IPO.

The case demonstrates how PE firms in emerging markets with operational capabilities have a distinct advantage in sourcing investments and driving higher returns. Students examine how minority investors can dynamically shape a portfolio company’s operational strategy to position a company for IPO or match potential buyers’ needs, thereby maximizing value for current owners.