VinFast, the Vietnamese electric automaker, has encountered a setback with its investors as shareholders of Black Spade Acquisition (BSAQ.A), a special purpose acquisition company (SPAC) planning to merge with VinFast for a U.S. listing, have chosen to redeem over 80% of their shares. This development poses a challenge for VinFast, which had initially intended to pursue a U.S. listing independently but has faced difficulties in commencing production and expanding sales beyond Vietnam.
Earlier this year, VinFast announced a delay in its plans to construct a $4 billion U.S. electric vehicle (EV) factory in North Carolina, pushing the start date for the facility from 2024 to 2025. Although the Hong Kong-based SPAC’s shareholders have yet to vote on the proposed merger with VinFast, they have exercised their right to redeem shares by the end of this week. The redemptions have amounted to approximately $147 million, leaving approximately $28.56 million in the SPAC’s trust account, according to Black Spade Acquisition (BSA).
VinFast finds itself among several EV startups contending to establish their position as market leaders Tesla and BYD engage in a price war, while the growth in demand for EVs appears to be slowing in major markets. BSA, which is listed on the New York Stock Exchange (NYSE), was established by the private investment arm of Lawrence Ho, the son of gambling mogul Stanley Ho. Originally, the SPAC aimed to merge with an entertainment company, as stated on its website. However, in a surprising turn of events, BSA delisted from NYSE a month later and joined the secondary NYSE American, a market catering to smaller-cap companies with relatively lower liquidity.
VinFast, founded in 2017, began selling EVs in California this year and had previously filed for an initial public offering (IPO) in the U.S. to list on the Nasdaq under the ticker symbol “VFS” in December of the previous year, targeting a valuation of around $60 billion. At the moment, VinFast has not provided any comments regarding the recent development with its investors.
The merged entity resulting from VinFast’s planned merger with BSA was anticipated to have a potential equity value of $23 billion, as estimated by both companies. Just before the conclusion of its original two-year term, the remaining shareholders of the SPAC voted on Thursday to extend its lifespan by one year.