Electric vehicle (EV) enthusiasts can get ready for an exciting new trading debut. Today, shareholders approved the motion for Vietnamese EV producer VinFast to merge with Black Spade Acquisition Co (NYSEMKT:BSAQ). This combination with a special purpose acquisition company (SPAC) will allow the newly formed stock to start trading after the deal closes on Aug. 14. Pending no delays, trading will commence on the following day or close to it.
As a combined company, it will trade on the Nasdaq under the symbol VFS. While summer 2023 has brought several highly anticipated initial public offerings (IPOs), there haven’t been so many SPAC mergers. But if the VinFast SPAC debut goes well, it could usher in a new SPAC season as companies opt for the less conventional way of going public.
What else do investors need to know as VinFast prepares to come public and enter a booming EV market? Let’s take a closer look at this company and assess what to expect.
The VinFast SPAC Is Coming
Vietnam may not be the first country that comes to mind when investors think of EV markets. But when VFS begins trading, it will make VinFast founder Pham Nhat Vuong the country’s wealthiest man, according to Reuters. The company’s leader has been eyeing a U.S. listing for some time and is currently at work building a manufacturing plant in Chatham County, North Carolina. Additionally, with the combination, VinFast is valued at $23 billion, a higher valuation than either Lucid Motors (NASDAQ:LCID) or Rivian (NASDAQ:RIVN) had upon their trading debut. All systems are go for the VinFast SPAC debut as the company looks to pull away from its past. As InvestorPlace reports:
“This isn’t the first time that a potential VinFast public debut has been floated to investors. In December 2022, the company applied to list on the Nasdaq but ended up withdrawing when market conditions became highly volatile. Now as the new bull market continues to lift many sectors, though, the firm seems to be choosing an optimal time to come public. After all, investors are seeking new opportunities in the tech sector and, with gas prices rising, EV stocks are likely to soar.”
It is clear that VinFast made a highly strategic choice by opting against its initial plan to go public. Now market conditions have indeed shifted, and EVs are back in focus. Billionaires are loading up on EV stocks as macro conditions point toward an increase in demand and sales. But while some companies in the space are still struggling to adjust, investors are likely searching for new investment opportunities.
The timing for a VinFast SPAC debut is truly optimal, particularly with the company’s established presence in international markets.
Why It Matters
If gas prices keep rising, EV sales are likely to boom as more and more consumers make the switch to driving electric.
While VinFast is better known in Asian markets, it is working hard to make itself known to U.S. buyers. The company features a wide portfolio of mid-size electric sport utility vehicles (SUVs) that are either already available or will be soon. These models often appeal to families or prospective parents, a growing consumer market.
When the VinFast SPAC begins trading next week, it is likely to make a splash. Investors should pay close attention.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
