Electric car company Polestar to go public via SPAC

One of the electric car companies that are already producing and delivering new vehicles to consumers is taking the plunge into the stock market. A press release was issued on Monday that details Polestar’s signed agreement with Gores Guggenheim Inc., a special purpose acquisition company (SPAC) on the Nasdaq stock exchange.

The deal will inject $800 million in cash from Gores Guggenheim, according to the press release, as well as another $250 million from PIPE financing. The cash is “expected to be used to help fund significant investment in new models and the expansion of operations and markets”. In total, the expected valuation is $20 billion when the deal completes, and Polestar goes public. The transaction is expected to close in the first half of 2022.

Polestar a purpose-driven carmaker

The ethos at Polestar is defined clearly as sustainable electric performance. The company description states that they’re “determined to improve the society we live in by accelerating the change to a fully electric, climate-neutral future” by pursuing net-zero greenhouse gas emissions, transparency in carbon footprint reporting, and ethical business practices.

The performance aspect is widely visible in the Polestar 2 with standard AWD, up to 408 hp, and a range of up to 427km (264 mi) on a full charge. And as a relative of safety-conscious brand Volvo, it’s easy to make the jump that Polestar models will be safety-centric as well.

Polestar expects to grow its brand substantially, beginning next year with an all-electric SUV and several EV passenger cars within three years.

Thomas Ingenlath, Chief Executive Officer of Polestar, says, “This is a really exciting time for Polestar. With two award-winning cars on the road today in 14 active markets across three continents, we seek to expand to 30 markets by 2023. We are thrilled about the targeted addition of three new premium electric cars to our line-up by 2024, starting with our first SUV expected in 2022. In Alec and the Gores Guggenheim team, we have found a partner with an impressive track record of bringing leading companies to the public markets. The proposed business combination and listing position Polestar as a financially strong, future-proof, global electric car company. It will enable us to accelerate our growth, strategy, and most importantly, our mission towards sustainable mobility.”

A unique position to engage a SPAC

Polestar’s announcement doesn’t appear to be novel with other all-electric carmakers like Rivian, Lordstown Motors, Canoo, Lucid, and others already engaging with a SPAC for more liquidity. What sets Polestar apart is that they’ve already produced and delivered EVs to end consumers and have proven viable. Not only is the company backed by Geely who also holds Volvo Cars, but they’ve garnered financing from non-industry investors like actor Leonardo DiCaprio.

On why Gores Guggenheim Inc. is entering a business agreement with Polestar, Alec Gores, Chairman and Chief Executive Officer of The Gores Group and Chairman of Gores Guggenheim, states, “Polestar is a stand-out company in the EV space – a design-led, sports-performance oriented electric OEM focused on industry-leading sustainability solutions. The Company is truly differentiated from others given its premier vehicles, attractive financial profile, strong track record of performance, and the fact that it already has cars on the road across the globe. I had the privilege of seeing the line-up of upcoming models, and the cars represent best-in-class innovation and industry-leading design that set the brand apart. Driven by an incredible leadership team with Thomas at the helm, Polestar is well-positioned to capitalize on this exciting and dynamic time for car manufacturers.”

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