Vietnamese electric vehicle maker VinFast Auto (NASDAQ:VFS) has entered into a $1 billion equity subscription deal with Yorkville Advisors Global. This deal grants VinFast the right, but not the obligation, to issue shares to Yorkville during a 36-month commitment period.
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The agreement will terminate on November 1, 2026, or when Yorkville has subscribed to VFS shares equal to the commitment amount. VFS plans to use the funds raised for working capital, general corporate requirements, product development, and bolstering its sales and marketing efforts. This $1 billion deal follows recent remarks by VFS’ CEO, Le Thi Thu Thuy, who emphasized the need to tap “a lot of capital” for the company’s geographic expansion.
David Mansfield, the CFO of VFS, commented, “In addition to existing funding commitments, the transaction provides financial flexibility to fund our growth. We will continue to evaluate other capital markets transactions and sources of fundraising as VinFast continues to grow.”
VFS is setting up a $2 billion facility in North Carolina and has plans for facilities in India and Indonesia. Earlier this week, Thuy stated that VFS will rely on VinGroup JSC (its parent) and Founder Pham Nhat Vuong for support over the next 18 months.
Is VFS a Good Investment?
VFS has yet to receive major coverage from Wall Street. The stock has dropped by nearly 67.5% over the past month, continuing a steady value erosion for shareholders shortly after its Nasdaq debut in August.
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