Vietnamese automaker VinFast Auto Ltd. (VinFast) announced Friday that it has entered into a $1 billion standby equity subscription agreement with YA II PN, Ltd. (Yorkville).

VinFast said in a statement that the firm has the option, but not the obligation, to require Yorkville to subscribe for up to $1 billion of ordinary shares in VinFast at any time during the term of the subscription agreement, subject to certain conditions
and limitations.

According to the statement, the subscription agreement has a term of 36 months.

“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,

“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,” said David Mansfield, Chief Financial Officer of VinFast.

In addition to existing funding commitments, he said the deal provides financial flexibility to fund the firm’s growth.

“We will continue to evaluate other capital markets transactions and sources of fundraising as VinFast continues to grow,” he added.

Meanwhile, Yorkville Founder and President Mark Angelo said that VinFast is a true leader in electric vehicles (EVs).

“We are excited for this opportunity to be a part of VinFast’s growth and development, and we look forward to seeing VinFast’s continued success in the EV market,

“We couldn’t be prouder of our partnership with VinFast in its mission for a greener future,” he added.

Earlier in April 2023, VinFast’s Chairman Pham Nhat Vuong, Vingroup Joint Stock Company (Vingroup) and VinFast entered into a capital funding agreement, under which VinFast would receive grants of up to VND24,000 billion ($1 billion) from Vuong, as well as up to VND12,000 billion ($500 million) in non-refundable grants and up to VND24,000 billion ($1 billion) in loans from Vingroup, in order to support VinFast’s growth and global expansion plans.

VinFast – a subsidiary of Vingroup JSC – is Vietnam’s leading automotive manufacturer committed to its mission of creating a green future.

VinFast manufactures a portfolio of electric sports utility vehicles (SUVs), e-scooters and e-buses in Vietnam and exports to the United States, and soon, Europe.

Yorkville Advisors is a global registered investment manager to a number of private investment funds.

The firm invests funds’ capital through customized structured debt and equity investments.

Yorkville’s investment criteria focuses on management teams, business fundamentals, and stock trading metrics.

Its funds have broad investment mandates across many sectors and geographies.
Yorkville funds are often the sole investor in a capital raise, allowing for a controlled and disciplined exit strategy.

Its team has been providing growth and acquisition capital to public companies since 2001.

Vietnamese EV maker VinFast to expand into Southeast Asia, raising more capital – report