EV Startup Canoo Says It Will Begin Publicly Trading In Late 2020

(Bloomberg) -- Canoo, a Los Angeles-based startup that plans to sell electric vehicles by subscription, has reached an agreement to merge with Hennessy Capital Acquisition Corp. IV and begin trading as a public company later this year. 

The merger, first reported by Bloomberg earlier this month, values the combined company at $2.4 billion and will provide more than $600 million toward the development of Canoo’s electric vehicles, according to a statement from the two companies. Hennessy, a special purpose acquisition company, or SPAC, raised $300 million in an initial public offering in March of 2019 with a plan to buy an “industrial growth or industrial infrastructure company.” Hennessy and Canoo expect the transaction to close in the fourth quarter of 2020. The new company will be called Canoo and will be listed on the Nasdaq under the ticker symbol CNOO.

Canoo, founded in 2017 by a pair of former BMW executives, had planned to begin selling subscriptions to its first vehicle, a seven-seater van, late next year, but has pushed that release to early 2022 because of delays caused by the Coronavirus pandemic. It also expects to release a sport sedan in 2025 and to sell electric delivery vans for commercial use beginning in early 2023. All three vehicles will use the same platform to house the battery, drivetrain and suspension—a modular system known as “skateboard” technology. 

“We have enough funding to go, from now, straight forward, laser focused to start up production and deliver our vehicles,” Canoo co-founder and CEO Ulrich Kranz said in a phone interview. 

Hennessy chairman and CEO Daniel Hennessy said the SPAC looked at more than a dozen electric vehicle and advanced mobility companies before settling on Canoo. “It was clear to us that this company was truly world-class,” said Hennessy, who has previously used SPACs to acquire school bus maker Blue Bird Corporation, flatbed trucking company Daseke, and hazardous waste management company NRC Group Holdings.

©2020 Bloomberg L.P.