Analyzing GSM’s Listing Roadmap in Hong Kong: The Core Mechanism of the GSM IPO structure

The recent establishment of GSM Holding has triggered vibrant discussions among legal and financial advisors regarding the Hong Kong Stock Exchange (HKEX) listing roadmap for this green mobility “unicorn.”

Based on the current ownership structure—where Vingroup and the Chairman’s family hold approximately 70%—the core question arises: Who owns the remaining 30%, and what transaction structure will be deployed to take this enterprise international? Market analysts are closely evaluating the potential GSM IPO structure to see whether it will witness a revival of the Variable Interest Entity (VIE) structure—a model previously utilized by VNG—or a complex variation of a Share Swap/P-Notes, mirroring the precedent set by VinFast.

1. Scenario Forecast for Capital Flow Structures: Optimizing SPV and VIE via the GSM IPO structure

If the ultimate goal is listing GSM’s shares in Hong Kong, the enterprise must solve the Foreign Ownership Limit (FOL) riddle, which caps foreign equity at 49% in Vietnam’s passenger transport sector. To bypass this barrier, a Special Purpose Vehicle (SPV) based in Singapore or Hong Kong is highly likely to be established through a sophisticated structural roadmap under the projected GSM IPO structure:

• Ownership Separation at GSM Vietnam: The SPV will hold the maximum direct stake allowed (potentially capped at 49%) in the operating company (GSM Vietnam). This ensures GSM Vietnam maintains its status as a “domestic enterprise,” preserving the validity of its core taxi business licenses.

• Dual-Class Shares Structure at GSM Holding: This represents a highly sophisticated governance leverage technique within the GSM IPO structure. The charter capital may be divided into two distinct tranches:

  • (i) 35% Ordinary Shares: Carrying 100% of the voting rights, projected to be transferred to the SPV to position it as the parent company.

  • (ii) 65% Preference Shares: Holding the vast majority of economic interests (subject to certain conditions) belonging to the Vietnamese shareholder group. According to the roadmap, maximum economic benefits will be transferred to the SPV upon obtaining M&A Approvals and Merger Filing Clearance from the National Competition Commission.

• Indirect Holding Mechanism: By owning 30% to 49% of the shares in GSM Holding, the SPV can indirectly regulate the economic interests of the entire ecosystem without breaching the foreign ownership ceiling.

• Establishing the VIE Tether (Control Agreements): To seal the structure, a network of management contracts, technology copyrights, and call options will be executed. The objective is to siphon all economic benefits from the operating entity in Vietnam back to the offshore Holding company. Consequently, international investors on the HKEX will be purchasing “beneficial rights” rather than directly owning assets located in Vietnam.

2. Consolidated Financial Statements (IFRS 10) and Listing Conditions Under the GSM IPO structure

The proposed investment framework is fundamentally sufficient to establish a Parent-Subsidiary relationship for listing purposes. Under International Financial Reporting Standards (IFRS 10), an entity (the SPV) is deemed a parent company if it fulfills three criteria: power over the investee, exposure or rights to variable returns, and the ability to use its power to affect those returns.

• At GSM Holding: The SPV holds only 35% of the capital but commands 100% of the voting rights. This grants the SPV absolute power over Board of Directors appointments and strategic decisions. If the 65% preference shares held by the domestic shareholder group are non-voting shares, the SPV fully establishes its status as the Parent Company from a governance standpoint.

• At GSM Vietnam: The SPV directly holds 49% of the ordinary shares. The remaining 51% is held by GSM Holding. Since the SPV already controls GSM Holding, it indirectly controls this 51%, bringing its total effective voting power to 100%.

However, independent legal counsels and auditors will demand clarity on the risk of economic interest dilution. To list successfully, the SPV (Listing Co) must present consolidated financial statements. In this setup under the GSM IPO structure, despite holding 100% voting control, the SPV’s “Economic Interest” is substantially diluted (retaining only 35% at the Holding level and around 67% at GSM VN). Stringent international exchanges like the HKEX typically require the listing company to retain the lion’s share of economic benefits to ensure the stock remains attractive to global investors.

3. Defining the Nature of the 65% Preference Shares: The Boundary of Control

A pivotal point that international advisory law firms will heavily scrutinize is the true legal nature of the 65% preference shares within the framework of the GSM IPO structure.

For the HKEX to approve the proposed GSM IPO structure, advisors must demonstrate that the SPV possesses absolute, unhindered operational control. This implies that the 65% preference shares must not carry restrictive Veto rights over critical corporate decisions, such as asset disposals, mergers, or alterations to core business lines. If domestic shareholders retain deep intervention powers, the SPV’s control will be deemed invalid for listing purposes.

4. Looming Legal Challenges Ahead for GSM’s International Strategy

Aside from the ingenuity of navigating around the FOL, the GSM listing roadmap will inevitably run into significant legal hurdles:

• Cross-Border Cash Flow Scrutiny: Siphoning profits abroad in the form of service or consultancy fees under a VIE model is increasingly targeted by regulatory authorities clamping down on transfer pricing and tightening foreign exchange controls.

• Investor Risk Appetite: Following regulatory crackdowns on Chinese companies utilizing the VIE structure (such as Didi), HKEX investors have become exceptionally cautious regarding the long-term sustainability of this model.

• Legal Due Diligence Timeline: The enterprise will require a substantial amount of time to secure M&A approvals and Merger Filing clearances in Vietnam.

If all legal frameworks are flawlessly executed and successfully clear the rigorous vetting processes, market experts project that we could see GSM ring the opening bell on the Hong Kong Stock Exchange as early as September or December 2026.

⚖️ Professional Perspective

P.S.: One thing is certain—the Vietnamese Legal Counsel team handpicked for this deal will face immense pressure. The sheer volume of Transaction Documents and economic contracts required to complete this GSM IPO structure is monumental, demanding ultra-high precision to simultaneously ensure enforceability and optimize the Issuer’s benefits.

Let us wait and see the next “chess move” of billionaire PNV on the international financial board.

Contact IVLF Advisors LLC

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