VinFast Auto Limited will transfer a part of its research and development (R&D) assets to a new company, which founder and CEO, Pham Nhat Vuong, plans to acquire for approximately $1.5 billion, in an effort to improve the company’s financial standing. The move comes as the Vietnamese automaker continues to grapple with financial difficulties despite a rise in revenue.
The Novatech Research and Development Joint Stock Company will be spun off from VinFast Trading and Production JSC (VFTP), which serves as VinFast’s core production and R&D arm in Vietnam. The newly formed Novatech will take ownership of specific completed development projects and the associated intellectual property. Following the separation, VinFast will maintain an initial 37.65% stake in Novatech’s capital while retaining nearly full control through its voting rights.
The company officially submitted the plan to the U.S. Securities and Exchange Commission last week.
Right after the separation, VinFast intends to sell all of its shares in Novatech to Pham Nhat Vuong, the company’s CEO and majority shareholder. The deal includes a fair market value of 17.25 trillion Vietnamese Dong (about €560 million), along with an added premium, bringing the total purchase price to roughly €1.3 billion.
VFTP will retain its core operations, continuing to produce electric vehicles in Vietnam, such as the VF6 and VF8 models destined for Europe, and lead future innovation efforts. If VinFast needs to utilize Novatech’s technologies in its manufacturing process, it will acquire the necessary rights through licensing deals.
VinFast, which went public on Nasdaq in 2023, continues to face sluggish demand and intense market competition. In 2024, the company delivered 97,399 electric vehicles, almost three times its 2023 volume, marking a 192% increase. However, despite this surge in deliveries, total revenue rose by only 57.9% to approximately $1.8 billion, while net losses widened to around $3.18 billion.
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