Polestar to go public at $20bn valuation via SPAC

27 September 2021 - 13:15 By Reuters
Polestar CEO Thomas Ingenlath.
Polestar CEO Thomas Ingenlath.
Image: Supplied

Swedish electric-car maker Polestar said on Monday it will go public by merging with a blank cheque firm backed by billionaire Alec Gores and investment bank Guggenheim Partners at a valuation of $20bn (roughly R300,730,000,000) including debt.

Polestar's listing plan comes as automakers shift their focus to environment friendly vehicles amid rising pressure from lawmakers and investors concerned about climate change.

The deal with Gores Guggenheim Inc will include cash proceeds of around $800m (roughly R12,029,200,000), assuming no share redemptions by public stockholders of the blank cheque firm.

The deal also includes a Pipe, or private investment in public equity, of $250 m (roughly R3,761,100,000) from top tier institutional investors.

Shares of Gores Guggenheim were up 7.8% premarket.

Polestar, backed by Volvo Car Group and affiliates of Geely chairman Eric Li, also counts Hollywood actor Leonardo DiCaprio among its investors.

The premium EV maker's offering includes two models — a hybrid performance car known as Polestar 1 and a fully electric Polestar 2 which are on roads across Europe, North America and Asia.

The company, which delivered about 10,000 vehicle last year, said it expects to sell about 290,000 vehicles per year by 2025 and plans to launch three new models by 2024.

Polestar said at the Beijing Motor Show last year that it has another model in development called the Precept, which is a larger sedan.

Polestar raised $550m (roughly R8,274,420,000) in external funding in April and announced plans in June to build Polestar 3 electric sport utility vehicles at Volvo's US plant in South Carolina from next year.

Current equity holders of Polestar, who will roll their entire interest in the combined company, will retain about 94% ownership, it said.

Post merger, the combined company will be named Polestar Automotive Holding UK Ltd and will trade under the symbol "PSNY" on the Nasdaq.


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