VinFast’s Nasdaq debut features world’s biggest merger: UNCTAD

The Nasdaq listing of Vietnamese EV maker VinFast via a $23 billion reverse merger with a US-based SPAC was the biggest merger & acquisition (M&A) deal in the world in 2023.

The United Nations Trade and Development (UNCTAD) highlighted the information in its World Investment Report 2024 released last week.

VinFast Auto is the carmaking arm of Vietnam's leading private conglomerate Vingroup.

Overall, the value of M&A deals in developing economies dropped by $31 billion year-on-year to $76 billion in 2023, resulting in about half of the global FDI inflows, the report said.

In 2023, global M&A sales reached $378 billion, down 46% year-on-year, with 6,717 deals, down 13%. The automotive industry bucked the trend with a sales value of $31 billion, up 273% year-on-year. The VinFast deal accounted “for a large part of the uptick in the automobile sector.”

Reviewing the manufacturing sector in 2023, the UNCTAD report noted that major multinational enterprises (MNEs) have halved their greenfield investments in China since 2019.

“Among major MNEs, Hon Hai Precision Industry (Foxconn) and Samsung Electronics have reassessed their manufacturing footprint in China because of ongoing trade tensions. Those two have started investing in new manufacturing facilities in their home markets and in other countries such as Vietnam, India and Mexico. Notably, Foxconn tripled the number of manufacturing projects in Vietnam,” the report highlighted.

According to UNCTAD data, FDI inflows in Vietnam reached $18.5 billion in 2023, up from $15.5 billion in 2018, $16.1 billion in 2019, $15.8 billion in 2020, $15.7 billion in 2021, and $17.9 billion in 2022.

As a result, Vietnam’s figure, per UNCTAD, was the third-highest in Southeast Asia, behind Singapore with $159.7 billion and Indonesia with $21.6 billion.

Global FDI flows slipped 2% to $1.3 trillion in 2023, as trade and geopolitical tensions weighed on a slowing global economy. The report underscored that the headline figure exceeded -10% when excluding a few European conduit economies that registered large swings in investment flows.

FDI flows to developing countries dropped 7% to $867 billion in 2023, the report said.