VinFast $65 billion stock debut vaults it past Ford, GM, at least for a while

VinFast Auto Ltd. soared in its debut as a public company, vaulting its market capitalization beyond that of General Motors Co. and Ford Motor Co., as traders flipped shares of the electric-vehicle maker.

The Vietnamese company, which went public in a SPAC deal, was worth about $85 billion after shares soared Tuesday, rising to $37.06 in New York — up more than 270% from the SPAC’s IPO price and more than tripling the deal’s $23 billion implied equity value. 

But by late Wednesday afternoon, the share price had dropped below $30 in after-hours trading.

VinFast debuted on the Nasdaq Global Select Market under the symbol VFS to a flurry of trading and volatility halts after completing a merger with special-purpose acquisition company Black Spade Acquisition Co. The 255% surge from the closing price of the SPAC on Monday makes the company the top performing de-SPAC to debut this year on a US exchange.

The eye-popping valuation made VinFast worth more on paper than BMW AG, alone, and more than Ford and Rivian Automotive Inc. combined on paper in terms of market capitalization, lagging BYD Co Ltd’s market value.

However, it should be noted that VinFast is a low-float company. There’s a small amount of shares available for trading — just 1.3 million shares of the SPAC remain after redemptions — which means the stock’s move and value are prone to large swings. 

Regulatory filings show Pham Nhat Vuong, Vietnam’s wealthiest man and VinFast’s founder, controls about 99% of the entity, partly via shares held by his wife and Vingroup JSC. That means the vast majority of shares are locked up and unavailable to investors who would have gained from Tuesday’s rally.

Additionally, companies that merge with "blank check" firms tend to experience rallies that fizzle out a few trading sessions after a deal closes, when social media buzz subsides. De-SPACs that have made their debut this year have seen a median slump of about 45%, with 18 of them wiping out more than 70% of their value, according to data compiled by Bloomberg.