Volvo-Backed Polestar Is in SPAC Merger Talks With Gores Guggenheim
(Bloomberg) -- 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 Gores Guggenheim Inc., a blank-check firm, according to people with knowledge of the matter. Gores Guggenheim rose as much as 7.7% on the news.
A transaction may value the combined company at around $25 billion, the people said. No deal has been reached and it’s possible terms could change or that talks fall apart.
Jennifer Kwon Chou, a Gores Guggenheim representative, and a Polestar spokesperson declined to comment. A spokesman for Volvo in the U.S. didn’t immediately respond to a request for comment. A Geely spokesman didn’t respond to a request for comment outside of Asian business hours.
Gothenburg, Sweden-based Polestar, led by Chief Executive Officer Thomas Ingenlath, is a rival to Tesla Inc. and EV maker Lucid Motors. It had been exploring options for going public as early as this year, Bloomberg News reported in March.
The company’s second vehicle and first all-electric car, the Polestar 2, started production in March at Geely’s plant in Luqiao, China. In September, the automaker said it would put another car, the Polestar Precept, into production. That vehicle’s interiors will be made out of recycled PET bottles and cork vinyl as well as reclaimed fishing nets.
Last month, the company said the Polestar 3 -- an SUV -- will be built in Ridgeville, South Carolina, in a plant opened by Volvo Cars in 2018. “Production in the USA makes procurement more efficient, reduces delivery times and will even have a positive impact on the price of the Polestar 3 SUV,” Polestar Chief Operating Officer Dennis Nobelius said at the time.
Gores Guggenheim, led by Chairman Alec Gores and CEO Mark Stone, is sponsored by affiliates of Gores Group and Guggenheim Capital. It raised $800 million in a March initial public offering.
The company’s shares rose about 5.3% to $10.25 at 1:55 p.m. in New York. They climbed to as high as $10.48 earlier.
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