VinFast secures up to $1B shares deal with Yorkville
VinFast, the Vietnamese electric vehicle (EV) manufacturer, has announced a share subscription agreement of up to $1 billion with U.S.-based fund Yorkville Advisors. The purpose of this deal is to secure funding for VinFast’s expansion into international markets.
According to VinFast’s filing to the U.S. securities authority, the agreement grants VinFast the option, but not the obligation, to require Yorkville to subscribe for up to $1 billion worth of ordinary shares at any point during the agreement’s term. VinFast, founded and predominantly owned by Pham Nhat Vuong, Vietnam’s wealthiest individual, made a remarkable debut on the Nasdaq exchange in August after merging with a blank-check company. The carmaker achieved a valuation of approximately $85 billion on its listing day, surpassing that of Ford, but has since experienced an over 84% decline in share value as of Wednesday’s close, with shares trading at $5.69 each.
VinFast’s Chief Finance Executive, David Mansfield, stated that this new equity funding source offers valuable flexibility and access to capital for the company’s global expansion plans. While there is no obligation to utilize the full amount, the transaction aligns with VinFast’s goal of opportunistically raising capital and increasing share liquidity over time. VinFast has sold approximately 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 made to a Vietnam-based fleet operator controlled by Vuong.
Mark Angelo, Founder and President of Yorkville, expressed anticipation for VinFast’s ongoing success. Yorkville had previously invested up to $400 million in EV maker Lordstown two years ago. VinFast has entered the market during a period of EV price pressure, driven by price reductions from market leader Tesla and various Chinese companies. Vuong, VinFast’s founder, remains its primary financial supporter. In April, the company announced receiving funding commitments worth $2.5 billion for future development, with $1 billion coming from Vuong’s personal funds.