Electric vehicle maker Arrival valued at $13bn in Nasdaq debut

25 Mar 2021

Image: Arrival

The London company has gone public through a merger with a SPAC that was set up by a former Marvel chief executive.

British electric vehicle firm Arrival has joined in the SPAC craze, floating on the Nasdaq at a $13bn valuation.

The London company, which is backed by BlackRock and car makers Kia and Hyundai, merged with a SPAC called CIIG Merger Corp that was set up by a former Marvel CEO.

Arrival raised $660m through the SPAC deal and is currently trading at around $20 a share. The listing is one of the largest stock market debuts for a UK tech company.

A SPAC is a special purpose acquisition company. These blank-cheque firms have exploded in popularity over the last year as a way to take companies public.

They are shell companies that raise money from investors, float on a stock market and then acquire a company and take it public – in this case Arrival. As a result, Arrival has avoided much of the administrative tasks of a traditional initial public offering.

Arrival was founded in 2015. It designs and manufactures its electric buses and vans in ‘microfactories’ using its own designed materials that it says are more sustainable. It has one of these facilities in the UK and two locations in the US.

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It raised $118m from BlackRock late last year, just a few months after raising $111m from Korean automaker Hyundai and sister company Kia.

UPS, another backer in the company, has committed to purchasing 10,000 of its electric vehicles, while the company plans to road test its newest van and bus models later this year and next.

“Arrival’s invention of a unique new method to design and produce vehicles using local microfactories makes it possible to build highly desirable yet affordable electric vehicles – designed for your city and made in your city,” chief executive and former Russian minister Denis Sverdlov said.

“Going public is an opportunity that will allow us to continue to scale globally, bringing these products to more and more cities and people. We also understand that this comes with responsibility,” he said.

CIIG Merger Corp, the SPAC that Arrival has merged with, was founded by Peter Cuneo, Gavin Cuneo and Michael Minnick. Peter Cuneo is the former chief executive of Marvel who led the comics giant in its sale to Disney. He now assumes the role of non-executive chair at Arrival.

Arrival opted to list in New York rather than closer to home in London even though the UK government is keen to attract more listings in the City post-Brexit and has been advised to loosen up rules to allow more companies to float on the London Stock Exchange.

While SPACs have soared in popularity of late, the listing avenue has begun to attract some scrutiny in the US – namely around risk management, given that companies are not going through the same rigorous compliance checks that an IPO entails. The Securities and Exchange Commission has reportedly opened an inquiry into blank-cheque companies and their risks.

Jonathan Keane is a freelance business and technology journalist based in Dublin

editorial@siliconrepublic.com