UPDATE 2-CVC Capital exits Vietnam's Asia Commercial Bank with stake sale, sources say

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CVC sold remaining stake via Sather Gate for some $220 mln

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Exit follows early April stake sale by another unit, Whistler

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ACB's market value has grown over three times since CVC invested

(Adds details of deal, background and context in paragraphs 7-12)

By Phuong Nguyen, Kane Wu and Yantoultra Ngui

HANOI/HONG KONG, April 12 (Reuters) - CVC Capital Partners has exited Vietnam's fourth-biggest private commercial lender, Asia Commercial Bank (ACB), after disposing of its remaining 4.99% stake for around $220 million, three people with knowledge of the matter said.

The Europe-based alternative investment firm disposed of the stake via a unit called Sather Gate, the three people said. The buyer is a U.S.-based institutional investor, according to two of the people.

The people declined to be identified as the matter was private. CVC declined to comment on Friday and ACB did not immediately respond to a request seeking comment.

The exit followed a stake sale in early April by another investment vehicle of CVC, called Whistler Investment, for $220 million.

Reuters reported in early January that CVC was in talks with an adviser to explore the sale of its stake in the Ho Chi Minh-listed bank following approaches from potential buyers.

Investor interest in Vietnam, one of Asia's fastest growing economies, has increased as the country pursues an entry into emerging market indexes or an upgrade from FTSE Russell, with the country aiming for inclusion by 2025.

Vietnam's banking sector has seen a rise in dealmaking activities in the past few years as lenders also seek to bolster their capital amid global uncertainties.

But approved new rules in January that lower the maximum stake investors can hold in domestic banks and the ripple effect of Vietnam's biggest financial fraud case could make investment in the sector challenging.

CVC invested in ACB in 2017, according to its website, which does not disclose financial details of the investment.

The market value of ACB, which focuses on the retail and small-to-medium enterprise markets, has jumped more than three times to some $4.3 billion as of Friday from early 2018, LSEG data showed.

CVC's latest stake sale fetched a slight premium over Friday's trading price, according to Reuters calculations.

ACB shares rose 3.1% on Friday.

CVC has been an active investor in Southeast Asia. It bought a minority stake in Indonesian gas company Samator Indo Gas from existing shareholders for $155 million last year. In December 2022, it sold its minority stake in Indonesia's Garuda Food Putra Putri Jaya to U.S-based Hormel Foods Corp .

ACB, established in 1993 and headquartered in Ho Chi Minh city, recorded a 17.22% rise in net profit in 2023.

(Reporting by Phuong Nguyen in Hanoi, Kane Wu in Hong Kong and Yantoultra Ngui in Singapore; Editing by Christopher Cushing, Devika Syamnath and Muralikumar Anantharaman)