Vietnam's Vingroup plans bond issue to raise $1.5 bln for automobile unit

A staff member works on an SUV produced by VinFast at its factory in Hai Phong City, northern Vietnam. Photo by VnExpress/Ngoc Tuan

Vingroup, Vietnam's biggest listed company, plans to raise $1.5 billion through the issue of international bonds next year to boost capital for its automobile unit, the company said in a statement.

The funds will be used to repay loans and for the expansion of VinFast, the group's automobile unit, the statement said. Bond holders will be able to exercise options to receive share in VinFast Singapore.

Vingroup earlier this month set up a Singapore-based holding company owning a stake in VinFast's operations in Vietnam in preparation for the auto-maker's listing on the U.S. stock market slated for the second half of next year.

The bonds would have a maturity of five years. Par value has not been revealed yet, the statement said.

VinFast became the country's first fully fledged domestic car manufacturer when its gasoline-powered models built under its own badge entered the market in 2019.

It is betting on the U.S. market, where its electric SUVs and a battery leasing model are expected to debut next year.

Vingroup said it was targeting global electric vehicle sales of 42,000 units next year, up from its previous plan of 15,000.