Vietnam-based conglomerate Vingroup has expressed interest in raising $1.5 billion via international bonds next year for its vehicle division VinFast.
The proceeds would be utilised to repay debts and to expand VinFast, the group's vehicle division and Vietnam’s first fully-fledged local automobile manufacturer.
Bondholders will be allowed to execute options for shares in VinFast Singapore.
Vingroup established a Singapore-based holding company earlier December to acquire an interest in VinFast's activities in Vietnam in preparation for the automaker's planned offering on the New York Stock Exchange (NYSE) in the second half of 2022.
The bonds would have a 5-year maturity. The par value has not yet been announced.
Relating to the distribution of VinFast Vietnam shares to a Singapore company, Le Thi Thu Thuy, vice president of Vingroup said, "The listing of Vietnamese companies abroad, especially in the US, has not yet been done due to complex legal corridor. In order to list in the US, VinFast is required to list through VinFast Singapore because Singapore is a country that has connections with the US in this field."
Although she did not reveal the particular strategy of VinFast's IPO, Thuy stated that VinFast would only sell 5-10 per cent of its stake, implying that foreign investors would only control a maximum of 10 per cent of the charter capital.
Previously, VinFast was rumoured to merge with a special purpose acquisition company for a US listing. Thuy also noted that the recent fruitful IPO of the US-headquartered electric carmaker Rivian, which is backed by Amazon, has been a poster child for other companies to follow in its footsteps.
Last month, Reteurs also reported Vingroup was in negotiations with foreign investors including Qatar's sovereign fund and BlackRock to raise roughly $1 billion in equity for VinFast.