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2023 VinFast VF9.
Courtesy of VinFast
Investors still relish the SPAC-powered EV startup’s appetite. Just look at VinFast.
The Vietnamese electric car maker began life as a publicly traded company on the Nasdaq Stock Exchange Tuesday after that Close Its merger with the Special Purpose Acquisition Company
Acquisition of black spade
(Stock ticker: BSAQ).
With the deal closed, Black Spade essentially becomes VinFast. The stock symbol changes to “VFS” from “BSAQ”.
Investors appeared elated after shareholders approved the merger on Thursday. Shares of Black Spade rose 73% to $18.50 per share, but have fallen 43% since then. It is now 24 cents lower than it was before the merger was approved.
Investors should prepare for more choppy trading. The stock, which will trade as VFS at the open, was up 7.5% in pre-market trading Tuesday.
Standard & Poor’s 500
And
NASDAQ Composite
Futures fell 0.6% and 0.7%, respectively.
It is not clear why traders would bid on SPAC-related shares when approving trades. Approval is one hurdle to clear up any SPAC merger, but it’s not hard to say which deals investors like and which they don’t. This shows which deals are most likely to be approved.
The VinFast-Black Spade merger was a deal that investors were excited about. VinFast’s stock value was estimated at $23 billion, more than the market value of
Rivian Motors
(reef),
Lucid
(LCID), or
Polestar Motors
(PSNY). All three electric vehicle startups have some traction with investors.
At $18.50 a share, Thursday’s closing price, VinFast was valued at about $43 billion, just under
general motors
The market capitalization of GM is about $46 billion.
The huge one-day gains and subsequent volatility remind investors of what things were like at the beginning of the SPAC boom.
Nikola
(NKLA) shares doubled on June 8, 2020, just days after closing its SPAC merger. Shares were at $79.73 the next day. They closed at $2.50 on Monday. It has been much more difficult for companies to build an electric vehicle business than investors initially imagined.
Even so, VinFast already has significant sales and manufacturing capacity, two things that investors have used to differentiate electric vehicle startups. The company delivered 3,800 electric vehicles in April, the latest month for which data is available. It also sells electric vehicles in the United States, where Americans bought 740 VinFast VF8 SUVs in the second quarter.
VinFast has the capacity to build around 300,000 electric vehicles annually. It has also begun construction on a $2 billion plant in North Carolina with a planned initial capacity of 150,000 vehicles per year.
VinFast’s 2023 sales should fall in the range of $1.8 billion to $2 billion. Rivian,
Lucid
And
Polestar sales are expected to be $4.3 billion, $800 million and $3.1 billion, respectively.
Now that VinFast is listed in the US, investors can look to analysts covering the stock and issuing estimates on sales and earnings. Investors expect positive expectations. With a market capitalization of $23 billion, VinFast is one of the most valuable electric vehicle franchises on the planet.
Write to Al Root at allen.root@dowjones.com
