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VinFast, a Vietnamese manufacturer of electric vehicles, announced on Wednesday that it had acquired a fresh round of finance commitments totalling $2.5 billion for its future expansion. This could indicate a further delay in the company’s intended American listing.
Two sources with knowledge of the situation earlier told Reuters that VinFast’s anticipated U.S. Initial Public Offering (IPO) would be postponed further, with one of them speculating that it might be moved into next year due to negative market circumstances.
Later on Wednesday, VinFast stated, “We remain committed and focused on our listing process,” without providing any additional information regarding the anticipated timing of the IPO.
VinFast, which started operations in 2019, is preparing to grow in the U.S. market. It intends to create a car and battery plant to compete with established automakers and startups, even if shipments of vehicles from its factory in Vietnam have so far moved slowly.
Of the new pledges, $1 billion will be provided as a grant within the next year from the company’s founder Pham Nhat Vuong, Vietnam’s richest man.
The largest conglomerate in Vietnam, the parent business Vingroup, will contribute a grant of $500 million and a loan of $1 billion with a maximum five-year maturity.
According to past business filings, that would bring the total amount of money raised by VinFast to $10.7 billion.
The company said that the grants and loan would “push VinFast to accelerate its development,” the company said.
According to Reuters’s March report, Vingroup plans to earn money through potential asset sales from its real estate developer and shopping mall subsidiary.
In April 2021, VinFast first hinted at a U.S. IPO with a $2 billion fundraising goal and a $60 billion value.
Several bankers have now stated that the IPO is anticipated this year, even though the listing was initially expected for the second half of last year. However, the company’s most recent filing to American authorities in March needed an updated schedule.
The market price for EV startups has sharply decreased as certain businesses with exorbitant valuations came under fire with the grim outlook for the global economy.
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