Shares of VinFast Auto Ltd. (VFS) experienced a 1.8% bounce in premarket trading on Friday following an important announcement. The Vietnam-based electric vehicle manufacturer revealed a new equity-funding agreement potentially worth up to $1 billion.
Standby Subscription Agreement with Yorkville
Opportunity for Expansion
VinFast's stock had tumbled 28.7% over the past four days, reaching a record low of $5.69 by close of trading on Thursday. However, the company's Chief Executive, David Mansfield, remains optimistic about the future.
“This new source of equity funding provides us with valuable optionality and access to capital to continue to expand our business on a global scale," said Mansfield. He further added, "While we are under no obligation to draw on the full amount, the transaction aligns with our goals of opportunistic capital raising while adding liquidity to our shares over time."
Recent Performance
Over the past three months, VinFast shares have experienced a significant decline of 44.6%. In comparison, the Global X Autonomous & Electric Vehicles ETF (DRIV) has dropped 18.3%, and the S&P 500 (SPX) has lost 5.7%. Despite these challenges, the recent equity funding agreement provides VinFast with a potential lifeline for future growth and stability.
