German EV Startup E.GO Weighs Listing Options Including SPAC

German EV hopeful Next.e.GO Mobile SE is in talks to go public through a blank-check company or an initial public offering that could value the manufacturer of compact cars for shorter trips at as much as 2 billion euros ($2.4 billion).

The company, saved from insolvency last year, may go through with the plan within the next 12 months, Chairman Ali Vezvaei said in an interview.

“There are advantages to both and we’re examining our options,” Vezvaei said, while the company has plans to produce a total of 300,000 vehicles over the next five years. “It could happen within the next 12 months.”

German EV Startup E.GO Weighs Listing Options Including SPAC

E.GO was founded by university professor Guenther Schuh, who’d previously sold the StreetScooter startup making bare-bones electric delivery vans to Deutsche Post AG. Offering no-frills electric cars, e.GO restarted its factory in Aachen this month after Dutch private equity firm ND Industrial Investments B.V plucked it from insolvency proceedings last year.

Deliberations for a listing follow a slew of EV hopefuls going public via mergers with special purpose acquisition companies with many failing to deliver on lofty goals. A wave of announcements from incumbent carmakers from Volkswagen AG to Stellantis NV have also wrested back the EV spotlight. Still, so-called SPACS remain a hot ticket for the electric-vehicle sector.

Polestar, the electric-car maker controlled by Volvo Car AB and its owner Zhejiang Geely Holding Group Co., is in talks to go public through a merger with a blank-check firm, Bloomberg reported Thursday. A transaction may value the combined company at around $25 billion.

“Looking at other BEVs with no production yet, e.GO -- which is in production -- could be valued around 1.5 billion to 2 billion euros, in line with the market,” Vezvaei said.

The company’s plant will go to full production in 2022 after limited output this year.

E.GO’s current model, the Life, has a driving range of 125 kilometers (78 miles) and a price tag of 26,560 euros that’s reduced to 16,990 euros in Germany after subsidies. The automaker has plans to expand to larger and sportier models.

Proceeds from a listing would go toward vehicle development and the manufacturers’ production network. In addition to its Aachen production site, e.GO has signed agreements to build factories in Greece, Mexico and is set to unveil a third European location next week. The company is in initial talks about setting up two production sites in Asia, Vezvaei said.

E.GO’s expansion plans under its new owner come after production shutdowns in the first wave of the coronavirus pandemic tipped the company into insolvency. ND Industrial Investments, with holdings in the logistics, transport and energy sectors, became its majority shareholder last year and installed Vezvaei as chairman.

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