(Reuters) – Lordstown Motors has agreed to go public through a merger with blank-check company DiamondPeak Holdings in a deal that values the electric pickup truck start-up at pro forma equity value of $1.6 billion, the companies said on Monday.
The combined company will be called Lordstown Motors Corp following the closure of the deal in the fourth quarter and will trade on the Nasdaq under the ticker symbol “RIDE”, the companies said.
A blank-check company is a shell company that raises money through an initial public offering to buy an operating entity, typically within two years.
A bunch of electric vehicle makers including Nikola Corp and Fisker have either gone public or are planning to list their shares through mergers with blank-check companies this year.
Lordstown has been working on a new full-size electric pickup truck called Endurance and last year hired Rich Schmidt, a former director of manufacturing at Tesla Inc, as chief production officer.
The company said the truck is aimed at the U.S. commercial fleet market, with initial production expected in the second half of 2021.
Lordstown expects to receive about $675 million of gross proceeds from the deal and will use the funds for the production of the new truck, which has secured $1.4 billion worth of pre-orders, the company said.
The deal includes investments by General Motors and institutional investors, including Fidelity Management and Research Company LLC, Wellington Management Company LLP, Federated Hermes Kaufmann Small Cap Fund, and funds and accounts managed by BlackRock, among others, Lordstown said.
Reporting by Ankit Ajmera in Bengaluru; Editing by Anil D’Silva