Chinese electric vehicle manufacturer Iconiq Holding Limited (NWTN) has agreed to merge with Nasdaq-listed special purpose acquisition company (SPAC) East Stone Acquisition Corporation, valuing the combined company at $2.5 billion.
In a statement, the two companies said the proposed merger has already been approved by both boards and will now be up for approval by the SPAC’s shareholders.
The outstanding shares of Iconiq and East Stone will be converted into “right to receive” shares of the merged entity. Iconiq Motors founder and chairman Alan Wu is expected to lead the new subsidiary after the closing of the business agreement.
The merger comes 14 months after East Stone terminated its previously announced business combination deal with JHD Holdings Limited. JHD is an online and offline merchant enablement services platform that provides almost 90,000 independent retailers in five provinces in China.
NWTN, which partners with auto supplier Magna Steyr and Microsoft Corp, was founded in 2016 by Wu and has offices in Tianjin, Shanghai, and Dubai. The announcement said it is headquartered in Dubai.
The company is a green mobility technology company that defines the smart passenger vehicle as a vehicle concept emphasising AI technologies, autonomous driving, and personalised passenger experience.
The company claims that its first model SEVEN and second model MUSE have received industrywide recognition at various global auto shows.
East Stone, the SPAC, raised $138 million in its IPO in the US in February 2020. Its prospectus said it intended to focus on firms that are operating in the fintech space in North America and Asia Pacific.
“We believe that NWTN’s insights on the value of the passenger-centric experience will drive NWTN into a blue ocean market with enormous opportunity, functioning as the hub of future intelligent mobility life,” said East Stone CEO Xiaoma Lu.
The merger comes even as some US-listed SPACs continue to steer away from acquiring targets in the Chinese market amid heightened oversight on foreign listings by Chinese issuers.