Pham Nhat Vuong, the Chairman of Vingroup and Vietnam's wealthiest individual, has made an announcement regarding his plan to donate his substantial 99.8% stake, valued at $270.8 million, in VinES batteries, a wine manufacturer, to the automobile company VinFast.
This transfer of shares will lead to a merger between VinES and VinFast, allowing the latter, known for its electric vehicle manufacturing, to refocus its efforts on the research and development of electric vehicle batteries.
VinES was initially established in August 2021 with a registered capital of VND 1 trillion ($41.7 million) with the primary purpose of researching and developing proprietary technologies and electric vehicle batteries for Vingroup. Vingroup currently procures these batteries from external sources.
The company underwent two significant capital increases in 2021, first to VND 2.7 trillion and then in July 2023 to VND 6.5 trillion. VinES is recognized for its research and production of high-quality lithium-ion batteries suitable for electric vehicles, energy storage systems, and various other applications.
To broaden its expertise, VinES has collaborated with battery technology firms worldwide, positioning itself as a comprehensive energy solutions provider. Following the merger with VinES, VinFast will inherit all the valuable assets, including patents, battery cells, battery packs, facilities, technologies, partnerships, and supplier contracts held by VinES.
Le Thi Thu Thuy, the Global CEO of VinFast, emphasized the significance of this merger, stating, "The merger of VinES and VinFast will enable us to be at the forefront of battery technology and electric vehicle battery supply. It will help optimize costs and enhance the technological capabilities of VinFast vehicles."
Mr. Vuong, the owner of 99% of VinFast's 2.3 billion common shares, previously contributed 7 trillion dong to the automaker in September. In the same month, the parent company, Vingroup, extended a loan of VND 23 trillion to support VinFast. Furthermore, it is expected that Vingroup will provide a $500 million non-repayable grant and an additional $1 billion loan to aid VinFast's operations.
Additionally, two shareholder companies under the control of Mr. Vuong, Asian Star Trading & Investment and Vietnam Investment Group (VIG), have pledged to donate the net proceeds from the sale of 46 million VinFast shares to support the automaker's endeavors.