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The backstory: In 2017, Pham Nhat Vuong, Vietnam's wealthiest person (with a current net worth of almost US$6 billion), laid the foundation for VinFast, Vietnam's first automaker. Over time, VinFast turned its attention to electric vehicles (EVs), aiming for a strong presence in the EV industry – especially in the US market. This caught the spotlight recently when, last year, VinFast announced it would fully switch its lineup to all-electric.
The company initially planned to go public in the US with a Nasdaq initial public offering (IPO) last year. But in May, it chose a merger instead, teaming up with the special purpose acquisition company (SPAC) Black Spade to prepare for listing in the US.
More recently: The road hasn't been entirely smooth for VinFast, especially when it comes to finances. In the first quarter of 2023, its revenue saw a 49% drop compared to the previous year, and it found itself facing a net loss of US$598 million. That was compared to a loss of US$411 million in the same period a year earlier.
Despite these financial bumps, the head of VinFast and the powerhouse conglomerate Vingroup, Vuong, was optimistic. He shared his positive outlook with Vingroup's shareholders in May, setting ambitious targets of up to 50,000 EV sales this year, and he's determined to break even by the close of 2024.
The development: Last week, VinFast announced that it's ready to make its debut on the Nasdaq stock market as soon as this week. This came after the shareholders of Hong Kong’s Black Spade gave a thumbs-up to the merger last Thursday. Both its parent company, Vingroup, and its SPAC partner, Black Spade, saw their shares shoot up following the announcement. In a joint announcement, VinFast and Black Spade disclosed their plans to make their Nasdaq entrance with the symbol VFS. This debut is set to happen around August 15.
According to their official statement, the merger has valued VinFast at US$23 billion. To put things into perspective, top players in the US EV scene, like Rivian and Lucid, are valued at roughly US$21 billion and US$16 billion, respectively. Preliminary filings show that VinFast’s existing shareholders will keep a 99% stake in the combined entity.
"The voting results today are a vote of confidence in VinFast from Black Spade shareholders," said VinFast global head Thuy Le in a statement.
“Our ultimate goal is to create an international brand,” said billionaire and VinFast founder Pham Nhat Vuong in an interview at the Hanoi headquarters of parent company Vingroup. “It will be a very difficult road, and we will have to put in a lot of effort. But there’s only one road ahead.”
“We have been watching the intensity of the market and I think this year, the market has been a little bit better. We are ready but we need the market to be more cooperative for us to make the IPO happen,” said Le Thi Thu Thuy, VinFast CEO, to CNBC in February.