RALEIGH – Electric vehicle manufacturer VinFast has more to celebrate today beyond the breaking of ground for its assembly plant in Chatham County: Its partner in a merger that could generate as much as $23 billion has formally agreed to the deal.

Black Spade Acquisition Corp. management voted in favor of the merger, according to an SEC filing disclosed on Friday.

Minutes later, VinFast and Black Spade issued a press release noting that the SEC had “declared effective the registration statement” of a merger and stock offering. However, according to the SEC that doesn’t mean the deal is approved. Says the SEC on its meaning: “a registration statement effective if the staff has reason to believe that the disclosure is incomplete or inaccurate in any material respect, the SEC’s declaration of effectiveness does not represent an approval of the merits of the IPO or an indication that the information disclosed is complete or accurate.”

“Today represents a remarkable milestone in advancing VinFast’s presence in the U.S. as we move towards our proposed U.S. listing,” said Thuy Le, Global CEO of VinFast Auto. “Along with this exciting step, today we also celebrate the start of construction of our electric vehicle (EV) factory in North Carolina. These achievements will help accelerate our commitment to the global green mobility revolution and our mission to help consumers make the switch to an EV easier and more accessible, while also opening a strategic capital-raising avenue for our global ambitions.”

More merger details

The companies have said they planned to close the merger in the third quarter of this year. By merging with publicly traded Black Spade, the combined company under the VinFast name can offer shares through a so-called SPAC (or Special Purpose Acquisition Company). Black Spade trades on the NYSE American exchange.

Black Spade will become a wholly owned subsidiary of VinFast, with the securityholders of Black Spade becoming securityholders of VinFast,” the company said in the filing.

The proposed agreement is being mailed to Black Spade shareholders. A shareholders meeting to vote on the agreement is set for Aug. 10, the companies said.

VinFast’s targeted stock symbols are “VFS” and “VFSWW,” the filing notes.

However, regulatory authorities such as the SEC have yet to approve the deal, according to the filing.

VinFast breaks ground EV assembly plant to employ 7,500 in Chatham County

Shares involved in the merger will be valued at $10 each and be worth a total of $23 billion, according to the filing. However, that amount is lower than the original target of $27 billion.

VinFast had told WRAL News that “the merger is still going as planned and expected to complete by the second half of 2023.”

Just weeks ago, Black Space had moved to extend by a year its existence as a SPAC. But VinFast had said the move would have no impact on the merger plans.

VinFast, merger partner: Work proceeding on deal that could be worth billions

While there have been some doubts in the media that the merger will be successful in generating billions in cash for expansion, the $4 billion needed for the Chatham plant and more, VinFast has proceeded with confidence. The groundbreaking and positive attitudes from corporate executives reflect that view.

Company spokesperson Jeff Holland also told WRAL News before the merger announcement Friday that “Vingroup and Chairman Pham Nhat Vuong always supports VinFast and we are confident in our financial ability.”

Why choose a SPAC?

Jim Verdonik, a veteran technology-focused attorney based in Raleigh, said SPACs offer advantages over traditional Initial Public Offerings, or IPOs:

“The private placement [with investors] VinFast is doing now can be done faster and with fewer expenses than for a traditional IPO,” he says. “Also, IPOs create greater liability risk for both the company raising money and the investment bankers who help raise the money compared to the liability risk in a private placement. There are more defenses to liability risk in a private placement than in an IPO.  Finally, SEC review of financial statements in IPOs are very strict. This is less so in a SPAC deal where the only SEC review is of the proxy statement tat is sent to SPAC stockholders to approve the merger.”

VinFast’s IPO deal: How does a SPAC work in raising cash? Tech attorney explains

The chairman is also the owner and founder of the company. Before the SPAC agreement was announced earlier this year he had pledged a good portion of his fortune to the company and its expansion efforts.

VinFast withdrew its own filing for a Wall Street stock offering before announcing the Black Spade deal in early June.

The company also pressed ahead with the U.S. expansion and the merger despite reporting huge losses in its most recent financial disclosure.

Note: This story has been updated to note Black Spade shareholders have not yet approved the deal. A vote is set for Aug. 10.

VinFast withdraws proposed stock offering, reaffirms use of merger to raise funds