VinFast SPAC merger world's largest M&A deal in 2023

June 25, 2024 | 11:47

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The $23 billion reverse merger of VinFast Auto in Vietnam with a United States-based special purpose acquisition company (SPAC) was the world's largest merger and acquisition (M&A) deal in 2023, according to World Investment Report 2024

VinFast SPAC merger world's largest M&A deal in 2023

The report was published by the United Nations Conference on Trade and Development (UNCTAD) on June 20. The value of M&A sales in developed countries declined by 50 per cent to $302 billion in 2023.

Most transactions were concentrated in a small group of countries. Almost half of the M&A targets were based in the US and the United Kingdom. Germany, Canada, Switzerland and France accounted for an additional 30 per cent of deal values.

Meanwhile, the value of M&A sales in developing economies in 2023 declined by $31 billion (to $76 billion). Despite the drop, several large transactions took place. The largest M&A sale in 2023 was the $23 billion stock swap between electric vehicle maker VinFast and a United States-based SPAC, according to the report.

Globally, cross-border M&A sales were down by 46 per cent to $378 billion. The deal count contracted by 13 per cent to 6,717 deals last year. The number of M&A sales decreased across all major industries except for extraction and automobiles.

"The $23 billion reverse merger of VinFast Auto in Vietnam with a SPAC based in the US accounts for a large part of the uptick in the vehicle sector," UNCTAD noted.

Several factors explain the drop in M&A activity overall, including tight financial conditions and uncertainty in financial markets. Greater scrutiny from antitrust bodies and foreign investment regulators also affected M&A deals in the US, the biggest market.

The global environment for international business and cross-border investment remains challenging in 2024. UNCTAD forecasts the market for M&As to recover, although cross-border transactions may take longer to react.

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By Thanh Van

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