Electric-vehicle maker Xos agreed to go public by merging with the special purpose acquisition company NextGen Acquisition NGAC, the latest blank-check-company initial public offering.
The deal values the combined equity at $2 billion, the two companies said in a statement on Monday.
The transaction will provide $575 million of gross proceeds to the company. It includes a $220 million oversubscribed and fully committed private investment in public equity, anchored by Janus Henderson Investors, as well as a group of truck dealers led by Thompson Truck Centers.
Vehicles from Xos, Los Angeles, have been deployed in field operations since 2019, the companies said. Its customers include UPS (UPS) - Get Report, armored car company Loomis, and transportation company LoneStar.
The deal is expected to close in the second quarter. The new company will be listed on the Nasdaq under the symbol XOS.
Xos Co-Founder and Chief Executive Dakota Semler, Co-Founder and Chief Operating Officer Giordano Sordoni, and NextGen Co-Founder and Co-Chairman George Mattson will join a new board.
Mattson said NextGen reviewed more than 100 potential merger opportunities and "Xos is best-positioned to capture the rapidly growing demand for commercial electrical vehicles with a compelling customer offering."
Mattson is a former Goldman Sachs banker who started the NextGen SPAC, which is based in Boca Raton, Fla.
Semler told Bloomberg that Xos has other distribution partnerships that haven’t been announced yet.
He said states like California, which are phasing out cars that produce emissions, will help increase demand for commercial electric vehicles like Xos.
“Fleets have to begin planning for this and making that transition," he said.
This is the latest in a series of SPAC IPO deals. Electric-vehicle startup Lucid Motors is close to going public by merging with a blank-check company started by investment banker Michael Klein.
So far this year 160 SPAC IPOs have been unveiled, accounting for 78% of the total number of companies going public, according to SPAC Analytics.
Last year saw 248 such deals, compared with 59 in 2019 and 46 in 2018.
At last check, NGAC shares were trading off 2.4% at $12.87. They'd closed Friday up 7.2% at $13.18.