Arrival, the British electric van and bus start-up, is due to be listed on the Nasdaq stock exchange in New York in a deal that is expected to value the company at more than £ 4 billion.
The Banbury, Oxfordshire-based manufacturer will raise $ 660million (£ 498million) in cash as it prepares for mass production of its first electric bus within a year, followed by its electric van in early 2022.
The fundraising will be achieved through a merger with CIIG Merger Corp, a Special Purpose Acquisition Company (SPAC) led by Peter Cuneo, former CEO of comic book company Marvel. PSPCs are also referred to as “blank check” companies because they are created by investors specifically to find and buy another business.
The arrival has exploded onto the global auto scene over the past two years – having previously operated in secret – with a plan to use smaller, cheaper “micro-factories” to produce electric vehicles using robots, instead of the production line model, pioneered by Henry Ford, to mass-produce cars.
Arrival, which now employs around 1,300 people mostly in the UK and US, says its van will cost about the same as comparable fossil-fueled vans on the market, which cost around £ 35,000, and significantly less. expensive than its rival electric vans. Vans will be 17% cheaper than diesel vans over their lifetimes, a key factor for companies operating fleets of vehicles, while the total cost of buses could be halved, depending on arrival demands.
The listing announcement came on the same day the UK government announced a ban on sales of internal combustion engine cars after 2030 and hybrids after 2035, underscoring the opportunity for up-and-coming electric vehicle manufacturers. .
Avinash Rugoobur, Director of Arrival Strategy, said that “we are at an inflection point” when the transition to electric vehicles accelerates rapidly.
Rugoobur said Arrival will generate cash by 2023 and then add new microfacteria at a rate of up to four per year.
He insisted the company would still be a UK success, despite being listed in the US. The company’s head office and research and development will remain in the UK, London and Banbury. However, it will establish production sites close to its markets around the world, including a previously announced plant in South Carolina in the United States.
He also raised the prospect of Arrivée arriving in smaller passenger vehicles, focusing first on taxis, but with the possibility of cars for consumers as well.
“I don’t think there are any limits to the segments that we can possibly move into,” Rugoobur said.
The listing will also allow Arrival to capitalize on the massive interest in electric vehicles from institutional and retail investors. An investment frenzy has propelled American electric car pioneer Tesla to become the world’s largest automaker by market value, worth more than $ 425 billion, compared to Ford’s $ 35 billion. The value of electric truck maker Nikola also rose in 2020, before declining after an alleged misselling scandal.
The arrival has already attracted hundreds of millions of pounds of investment, including from Korean automakers Hyundai and Kia and investment manager BlackRock. About $ 400 million of the latest fundraising will come from investors led by Fidelity, Wellington Management, BNP Paribas Asset Management and BlackRock.
Sign of its rapid acceleration, previous transactions valued the arrival at 3 billion euros, against $ 5.4 billion of valuation expected when it was introduced in New York.
The investment will be used to fund the Race to Finish to fulfill customer orders which are now worth $ 1.2 billion. UPS, the US delivery company, ordered 10,000 electric vans in January as part of its efforts to decarbonize its urban deliveries. Arrival also has letters of intent with other unidentified potential customers.
Arrival, headquartered in west London, was founded in 2014 by Russian entrepreneur Denis Sverdlov, who sold telecommunications company and phone maker Yota in 2013. Sverdlov will remain the managing director of the company after listing, Cuneo becoming non-executive chairman.