Canoo Holdings Ltd., a Los Angeles-based electric vehicle startup, has agreed to merge with Hennessy Capital Acquisition Corp. IV (HCAC), a special purpose acquisition company, the two companies said Tuesday.
The merger will result in Canoo becoming a publicly listed company with a valuation of $2.4 billion. Upon closing of the transaction, the combined operating company will be named Canoo Inc. and will continue to be listed on the Nasdaq Stock Market under the ticker symbol “CNOO”.
The business combination values Canoo at an implied pro forma equity value of $2.4 billion, at the $10.00 per share price and assuming no redemptions of HCAC’s existing public stockholders.
The combined company will receive about $600 million of proceeds from an upsized fully committed common stock PIPE offering of over $300 million, along with the about $300 million cash held in trust assuming no redemptions of HCAC’s existing public stockholders.
The boards of directors of both Canoo and HCAC have unanimously approved the proposed business combination that is expected to be completed in the fourth quarter of 2020.
Canoo has designed a flat modular “skateboard” platform, which allows the company to maximize usable interior space and support a wide range of vehicle applications. The company’s skateboard architecture directly houses all of the most critical components of an electric vehicle.
Canoo has also developed proprietary electric drivetrain and battery systems which are incorporated into the skateboard.
According to the company, all of its electric vehicles will share the same skateboard and utilize different cabins or “top hats” that can be paired on top to create unique vehicles.
Canoo Co-Founder and Chief Executive Officer Ulrich Kranz is an automotive industry veteran with more than 30 years of executive experience at BMW.
Canoo expects to introduce its first model in 2022 that will be targeted at consumers in major urban markets. This lifestyle vehicle, eponymously named the canoo, has been purposefully developed for a subscription business model.
Canoo has also designed a commercial delivery B2B vehicle that is expected to be available in 2023.
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