The Swedish EV maker is ready to go public.
Swedish electric vehicle company Polestar has announced it will soon complete a merger with Gores Guggenheim, a special purpose acquisition company (SPAC). The company says it expects the deal (which should close on Thursday) to raise "at least $850 million in gross proceeds through a combination of a fully committed PIPE and cash held in trust."
Pending the approval of Gores Guggenheim shareholders, the newly-formed partnership will start trading under the new PSNY symbol, replacing the GGPI ticker symbol currently used by Gores Guggenheim. If everything goes according to plan, the business combination should start trading on Friday, June 24.
Currently, the company produces just the Polestar 2. However, the substantial funds it will receive from investors will serve as a much-needed shot in the arm and allow the EV maker to offer additional models, such as the upcoming Polestar 3 SUV.
"Our listing on the Nasdaq in partnership with Gores Guggenheim will be a milestone moment for the company. Our team has been working hard and that work is paying off. We are excited about the future of Polestar and will continue to build world-class electric cars, grow the passionate customer community and expand into even more markets around the globe," said Polestar CEO, Thomas Ingenlath.
Hopefully, the automaker can avoid the issues faced by many now-public EV startups. When Rivian was listed in November of 2021, the EV company sent shockwaves through the investment community as its market value quickly shot past the $100 billion mark. For a brief moment, RJ Scaringe's company was worth more than Ford and GM. Since then, the share price has plummeted. At the time of writing, it sits at $29.07 per share.
But things may be different for Polestar. Ingenlath has said that, unlike other startups, it has actual cars on the streets and others physically in development. These include the aforementioned Polestar 3 SUV, Polestar 5 Sedan, and the Polestar 4 coupe crossover. There's also potential for more in the works as the sporty O2 concept looks magnificent, and sources within Polestar have told us the concept is being pushed towards production heavily from within the company.
As the company notes, preliminary redemption elections currently stand at around 25%. "To have limited redemptions in this challenging macro environment is an incredible feat and speaks to the strength of Polestar's brand - as well as the high conviction our investors have in Polestar's potential," commented Gores Guggenheim chairman, Alec Gores.
Essentially, this means the majority of the Gores Guggenheim stakeholders are in favor of the deal. The SPAC frenzy really kicked off in 2021, with myriad companies using the more convenient listing option. However, redemption rates can often exceed 60%, putting Polestar in good stead.
It's not the only company with stock exchange ambitions. Germany's Porsche has been eyeing a listing for quite some time and, if the VW Group decides to go through with the IPO, it could value the sports car maker anywhere between $51 and $101 billion.