Loss-making EV firm VinFast to get $3.4 bln more funding from founder, parent company

Nov 12 (Reuters) - Nasdaq-listed electric vehicle maker VinFast said on Wednesday it will get a fresh round of funding worth 85 trillion dong ($3.35 billion) from its founder and its parent firm, Vingroup (VIC.HM) , opens new tab by 2026, when it expects to break even. VinFast began operations in 2019 and has been expanding aggressively into global markets, but the firm continues to report increasing losses as it grapples with softer demand and challenges in the sector.

Approximately 50 trillion dong ($1.97 billion) of the new funding is expected to come from VinFast's founder, tycoon Pham Nhat Vuong, according to a company statement. Vingroup, one of Vietnam's largest conglomerates, intends to lend up to $1.38 billion to VinFast by the end of 2026 through its activities, dividends, and possible divestment, which it said may be conducted at an acceptable price if necessary.

Additionally, Vingroup will convert all existing loans to VinFast Vietnam into preferred shares with dividend entitlements, it said. Vuong, who owns 97.9% of VinFast shares both directly and indirectly, gave assurances of his commitment to increase investment in the automotive unit during a general meeting in April. "VinFast remains committed to raising independent capital to meet its financial needs. The support from Vingroup and Vuong will be utilised only if these independent efforts fall short," VinFast said in the statement.