Battery Power Boost: Tesla's Vietnamese Rival VinFast Snaps Up Battery Firm VinES

Vietnam-based EV maker VinFast Auto Ltd. VFS plans to acquire a 99.8% stake in VinES Energy Solutions, or VinES. 

VinFast will acquire VinES from its Chairman, Pham Nhat Vuong, for approximately $462 million debt, which VinES has outstanding to finance the construction of its manufacturing facilities and operations, the company said in an exchange filing. 

To support the ramp-up for VinES until its operations stabilize, Vuong agreed to provide grants to VinFast for all interest payments relating to these existing VinES borrowings up to 2027.

VinES operates in the fields of research, development, and production of high-quality lithium-ion batteries for electric vehicles, energy storage systems, and other commercial applications.

VinFast, supported by Vietnam's leading conglomerate Vingroup, said the strategic acquisition of VinES, another entity within the Vingroup ecosystem, would garner at least 5%-7% savings on battery costs for the combined business.

The acquisition of VinES will boost VinFast's competitiveness in the global electric vehicle market.

Le Thi Thu Thuy, Vice Chairwoman of Vingroup and Global CEO of VinFast said, "The acquisition of VinES will help VinFast control our battery technology and supply chain, thus optimizing operating expenses and enriching technology content in our electric vehicles. This is also an important step towards developing and controlling an integrated supply chain as well as comprehensive manufacturing system to further strengthen our competitiveness."

Price Action: VFS shares are trading higher by 4.14% to $7.80 on the last check Wednesday.

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