Nikola executes reverse merger with VectoIQ; now to be listed on NASDAQ; BEV and FCEV trucks
05 March 2020
Nikola Corporation, a designer and developer of BEV and FCEV Class 8 trucks is executing a reverse merger with VectoIQ Acquisition Corp. to create a company focused on the development of next generation smart transportation.
VectoIQ Acquisition Corp. (Nasdaq:VTIQ) is a $230-million publicly traded Special Purpose Acquisition Company (SPAC) formed for the purpose of effecting a merger, acquisition or similar business combination within 24 months of its IPO, which was completed 18 May 2018.
Upon the closing of the transaction, the combined company will be named Nikola Corporation and is expected to remain NASDAQ-listed under the new ticker symbol “NKLA.”
Nikola has logged more than $10 billion in pre-order leases to date; its joint venture with European industrial vehicle manufacturer IVECO make it a viable competitor to other OEMs. Nikola’s business model supplies both the truck and hydrogen fueling infrastructure, solving the fleets’ concerns of where to refuel with green hydrogen at competitive pricing to diesel.
The transaction proceeds will accelerate production, allow Nikola to break ground on its manufacturing facility in Coolidge, Arizona, and begin its hydrogen station infrastructure roll out.
The company expects to generate revenue by 2021 with the roll out of its BEV truck, followed by FCEV truck sales starting in 2023 and the initial build out of hydrogen fueling stations to serve Nikola customers’ fleets, such as Anheuser-Busch.
In our two-year quest to find a partner that was a proven technology leader and focused on making a global difference, Nikola was the clear winner. Nikola’s vision of a zero-emission future and ability to execute were key drivers in our decision.—Stephen Girsky, CEO of VectoIQ and former Vice Chairman of GM
Milton will serve as Executive Chairman of the combined company, continuing to lead the vision and forward-looking strategy. Prior to launching Nikola in 2015, Mr. Milton served as CEO of dHybrid Systems, a natural gas storage technology company.
Mark Russell, who has more than 20 years of experience building and managing companies in the manufacturing industry, will serve as the CEO of Nikola. He joined Nikola as President in 2019 and previously served as President and COO of Worthington Industries, a publicly-listed metals manufacturing company.
Kim Brady, currently the CFO at Nikola, will continue in that role post-close. Brady has more than 20 years of experience in private equity and investment banking. Prior to joining Nikola, Mr. Brady served as Senior Managing Director at Solic Capital, as well as CFO and General Manager at various companies in the manufacturing, business services and healthcare sectors.
Transaction Overview. The transaction reflects an implied enterprise value at closing of $3.3 billion. Cash proceeds raised in connection with the transaction, which will primarily be used to fund operations, support growth and for other general corporate purposes, will be funded through a combination of VectoIQ’s cash in trust and a $525-million private placement of common stock at $10.00 per share led by institutional investors including Fidelity Management & Research Company, ValueAct Spring Fund and P. Schoenfeld Asset Management LP. Current Nikola stockholders will remain majority owners of the combined company at closing.
The boards of directors of both VectoIQ and Nikola have unanimously approved the proposed transaction. Completion of the proposed transaction is subject to approval of VectoIQ and Nikola stockholders and other customary closing conditions, including a registration statement being declared effective by the Securities and Exchange Commission, and is expected to be completed in the second quarter of 2020.
Cowen is serving as financial and capital markets advisor, and Greenberg Traurig, LLP is serving as legal advisor to VectoIQ. Morgan Stanley is serving as financial advisor, and Pillsbury Winthrop Shaw Pittman LLP is serving as legal advisor to Nikola.
I am a fan of hydrogen.
However, I am not a fan of money extracted from the gullible by seeded gold mines.
Nikola has moved from ambitious but perhaps reasonable plans to asking for support for wholly speculative and quite unverified flyers into virgin engineering techcnology.
Here are the details of Nikola's new, improved snake oil:
'Nikola Corporation said that it has developed a new battery that has a record energy density of 1,100 Wh kg-1 on the material level and 500 Wh kg-1 on the production cell level—including casing, terminals and separator—more than double current lithium-ion battery cells. The Nikola prototype cell eliminates binder material and current collectors, enabling more energy storage within the cell. It is also expected to pass nail penetration standards, thus reducing potential vehicle fires.'
No extended testing, no proper details, just tp encourage the gullible to fork over a billion or so on a hope and a prayer.
in the present wildly speculative loose money environment, that has given them a market capitalisation of over $6 billion.
I would sooner invest in buying the Brooklyn bridge.
Posted by: Davemart | 05 March 2020 at 09:31 AM
Milton built himself a mansion but still no production after a decade.
Posted by: SJC_1 | 05 March 2020 at 10:01 AM
My broker will not allow me to buy VTIQ - blank check company. Who do you use to buy VTIQ?
Posted by: Robtdfischl | 10 March 2020 at 08:40 AM