Vietnamese electric vehicle (EV) maker VinFast has announced a share subscription agreement with U.S.-based fund Yorkville Advisors, with a value of up to $1 billion. The purpose of this agreement is to secure funding for VinFast’s expansion in international markets. VinFast has the option to require Yorkville to subscribe for up to $1 billion worth of ordinary shares at any time during the agreement. This information was disclosed in a filing to the U.S. securities authority.
VinFast, which was founded and predominantly owned by Pham Nhat Vuong, Vietnam’s wealthiest individual, had a successful debut on the Nasdaq stock exchange in mid-August. Following a merger with a blank-check company, VinFast achieved a valuation of approximately $85 billion, surpassing that of U.S. automaker Ford. However, since its listing day, VinFast’s shares have declined by over 84%, with each share currently trading at $5.69.
David Mansfield, VinFast’s chief finance executive, stated that this new equity funding option provides the company with valuable flexibility and access to capital for global expansion. Mansfield emphasized that while there is no obligation to utilize the full amount, this transaction aligns with VinFast’s goal of opportunistic capital raising and increasing liquidity over time.
VinFast has sold around 22,000 cars thus far and aims to achieve a sales target of 40,000 to 50,000 units this year. More than half of its sales have been to a Vietnam-based fleet operator controlled by Vuong.
Mark Angelo, the Founder and President of Yorkville, expressed his anticipation of VinFast’s continued success. It is worth noting that Yorkville previously invested up to $400 million in EV maker Lordstown two years ago.
VinFast has entered the market during a period of price pressure for EVs, driven by price reductions from market leader Tesla and various Chinese companies.
Vuong, the founder of VinFast, remains the company’s primary financial supporter. In April, it was announced that VinFast would receive funding pledges totaling $2.5 billion for future development, with $1 billion coming from Vuong’s personal funds.
The article was written by Phuong Nguyen and edited by Jason Neely and Martin Petty. The reporting adheres to the Thomson RushHourDaily Trust Principles.
