Fisker, an electric car startup, will go public through a merger with private equity-backed Spartan Energy Acquisition.
Michael Wayland reported the news for CNBC:
Electric vehicle start-up Fisker is expected to go public through a merger with a company backed by private equity firm Apollo Global Management with a combined value of $2.9 billion, the companies said Monday.
The aspiring California-based automaker will merge with Spartan Energy Acquisition, a special purpose acquisition firm. The deal is expected to close in the fourth quarter, officials said.
Spartan Energy opened Monday at more than $20 a share, but then gave up those early gains. Recently the stock was up more than 2.5%, in heavy volume.
CNN’s Jordan Valinsky wrote:
The new vehicle is “designed for optimal space and usability,” according to Fisker. It includes features like a a “California Mode” button, which opens all the windows at one touch and a rear hatch window that can roll down to allow long items — such as surfboards — to hang out the back. The Fisker Ocean will be available in late 2022 and cost about $40,000.
Fisker Automotive, a separate car company also founded by auto designer Henrik Fisker, began more than a decade ago. The first vehicle, Karma, was a plug-in hybrid that drew low ratings from Consumer Reports. Production of the Karma ended when the company declared bankruptcy a few years later and its assets — including some unassembled cars — were auctioned off. The hybrid has since been developed further, and is now being produced by another company, Karma Automotive.
Fortune’s Aaron Pressman quoted Fisker’s owner as saying:
“Having done this before, I just don’t feel it’s a good idea to try and raise so much capital in private rounds,” Fisker tells Fortune. “One round can be delayed, for whatever reason, and that means your product launch gets delayed, which then means you need to raise more money. I just don’t feel this works.”
The company aims to raise $1 billion of backing using a shortcut that another upstart electric-car maker, Nikola, used to go public last month. Forgoing the traditional method of hiring a Wall Street investment bank to sell new shares, Fisker is merging with an already public special-purpose acquisition corporation called Spartan Energy Acquisition, which is backed by private equity firm Apollo Global Management.