With the two donations, the total amount of private money that Vuong, the first Vietnamese dollar billionaire recognized by Forbes, has donated to VinFast is VND31.1 trillion.
On October 11, Vuong, president of Vingroup, announced he would donate all the 99.8 percent of stake he was holding in Vines Energy Solutions JSC, or VinES, to VinFast.
With the decision, VinES will merge with VinFast to help VinFast enhance its self-sufficiency in battery technology, thus allowing it to gather resources to strengthen research and development of battery for electric vehicle products with the Vietnamese brand name.
VinES was established in August 2021. After adjustments in operation scale, the company now has charter capital of VND6.5 trillion. It specializes in researching and developing a high-quality lithium-ion battery used for electric vehicles, energy storage systems and other applications.
VinFast will become the owner of all the patents for battery cells, battery packing, workshops, technology, partnerships and contracts with suppliers. VinES is currently cooperating with world leading battery technology partners, including CATL, Gotion and StoreDot.
Batteries are the most important component of electric vehicles and considered the competitive weapon of clean-energy vehicle manufacturers. With VinES transferred to VinFast, the automobile manufacturer is likened to a ‘tiger with additional wings’ as it can master the manufacturing process, from vehicle R&D and manufacturing to battery R&D and manufacturing.
The decision to merge VinES into VinFast was made as VinFast is taking strong strides in the world market and gaining impressive business results.
The automobile manufacturer delivered 10,027 electric cars in the third quarter of 2023, an increase of 5 percent over the second quarter, raising the total number of cars sold in the first nine months to 21,342. VinFast is nurturing an ambitious plan on entering 50 markets in 2024 and has announced a plan to build a factory in India with the capacity of 50,000 products a year in the first phase.
Prior to that, in late April, Vuong announced a donation of $1 billion (VND24.6 trillion according to the exchange rate October 12, 2023) to VinFast from his private assets.
Vingroup has also pledged to give non-refundable aid worth $500 million and a loan worth $1 billion for up to five years.
The VinFast Q3 financial report released on October 5 showed that in September, Vuong alone donated VND7 trillion to VinFast. If counting the battery company, the total amount of money Vuong has pumped into VinFast has reached VND13.5 trillion out of the total VND31 trillion he committed to donate from his private assets. T date, the total amount of money VinFast has received from Vingroup and Vuong has totaled VND36.5 trillion.
The prospectus submitted by VinFast to the US Securities and Exchange Commission) recently showed that the company expects to receive another VND12 trillion in non-refundable aid from VinGroup in the next six months.
The two shareholders, Asian Star Trading & Investment and Vietnam Investment Group (VIG), controlled by Vingroup president Pham Nhat Vuong, are expected to transfer to VinFast all the money to be collected from the sale of 46 million VFS shares. The total money VinFast expects to get in the next two quarters may be up to VND29 trillion or more (not including the battery company with charter capital of VND6.5 trillion).
If the revenue from the sale of the 46 million shares is not high enough to make up $1 billion as committed, Vuong will give additional money from his assets. Meanwhile, Vuong will give the surplus money if revenue exceeds the remaining part of the amount of $1 billion.
Following the good news, the VFS share closing price on October 11 saw an impressive growth rate of 8.41 percent to $8.12 per share.
The moves taken recently show the strong determination and commitment of Vuong and Vingroup in improving VinFast to help it be more competitive in the world market.
The promised generous support by Vingroup and its founder Pham Nhat Vuong is expected to lay down a firm financial foundation and create a driving force for VinFast to speed up and develop. This will help ease pressure on the electric vehicle manufacturer when raising international funds if the US stock market and the world’s electric vehicle market are still in a difficult situation.