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California Electric Automaker Fisker to go Public in a Deal That Would Give the Company a $2.9 Billion Valuation

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【Summary】​Electric automaker Fisker Inc is planning to go public in a deal which would value the California company at $2.9 billion. Fisker plans to list on the New York Stock Exchange through a merger with alternative investment management firm Apollo Global Management, Inc.

FutureCar Staff    Jul 13, 2020 5:00 PM PT
California Electric Automaker Fisker to go Public in a Deal That Would Give the Company a $2.9 Billion Valuation
The fully-electric Fisker Ocean SUV on display at CES in Las Vegas in January.

Electric automaker Fisker Inc is planning to go public in a deal which would value the California company at $2.9 billion. Fisker plans to list on the New York Stock Exchange through a merger with alternative investment management firm Apollo Global Management, Inc. which is affiliated with Spartan Energy Acquisition Corp (Spartan).

Spartan (NYSE:SPAQ) is a special purpose acquisition company sponsored by an affiliate of Apollo (NYSE:APO). The companies have entered into a definitive agreement for a business combination that would result in Fisker becoming a publicly listed company.

Apollo is a leading global alternative investment manager with assets of $316 billion under management as of March 31, 2020. 

The business combination values Fisker at a $2.9 billion pro forma equity value, at the $10.00 per share Private investment in public equity (PIPE) price and assuming minimal redemptions by Spartan shareholders, Fisker said in a statement. 

The boards of directors of both Spartan and Fisker have unanimously approved the proposed transaction, which is expected to be completed in the fourth quarter of 2020. The deal will provide Fisker with the necessary funding to bring its first product, the Fisker Ocean SUV, to production in late 2022. 

Fisker is among the new crop of electric vehicle startups, including Lucid Motors, Rivian and Nikola Motor, that's hoping to capture some of the success of Tesla, which over the last decade has grown to become the world's most valuable automaker.

The fully-electric Fisker Ocean SUV was first unveiled to the public in January at this year's Consumer Electronics Show in Las Vegas.

The Fisker Ocean is a fully electric SUV with premium styling and features. It's being designed to be the world's most sustainable vehicle, including extensive use of environmentally friendly and recycled materials, including recycled fishing nets, which reflects in the EV's name. 

The Fisker Ocean has won numerous awards since its debut at the Consumer Electronics Show earlier in 2020, highlighting strong market reception for Fisker ethos of appealing design and environmental sustainability.

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Fisker's Founder, Chairman and Chief Executive Officer Henrik Fisker said at CES in January that the Ocean will start at $37,499, but will also be available with a flexible lease option of $379 per month, including insurance with a high-mileage allowance of 30,000 miles per year.

"As we move into electrification, one of the things that's going to be most important is affordability at the end of the day." said Fisker. 

Mr Fisker is an automotive industry veteran and is best known for designing iconic luxury cars, including the BMW Z8 and Aston Martin DB9.

Following Tesla's lead, Fisker plans to sell the Ocean directly to customers. Mr Fisker said he plans to take out every single "middleman" involved in the purchase of a traditional vehicle and deliver the Ocean SUV right to customers so its more affordable.

Fisker is billing itself as "the world's first digital car company." "We want to do everything digital with as little brick and mortar as possible, because that is cost," Mr Fisker said at CES in January.

Mr. Fisker said the company will not have a network of dealers or a website for online sales. Instead, all interactions with the Fisker brand will be done via the automaker's app, including selecting the Ocean's options and purchasing or leasing it.

Customers looking to purchase an Ocean when it arrives in the U.S. can take advantage of the federal EV tax credit of $7,500 which brings the target price down to $29,999.

"Today, the realization of the world's first digital car company took another major step forward, advancing our mission to commercialize the world's most emotional and sustainable vehicles, while upholding our vision of a clean future for all," Mr Fisker said in a statement.

Drivers of the Fisker Ocean SUV will also be offered a flexible lease option that maximizes affordability, while delivering unrivaled ownership flexibility. Deployed through our proprietary app, our leasing model has been designed to appeal to customers looking for the ultimate in sustainable mobility and freedom from traditional and restrictive leasing programs."

"We are excited to work with Fisker to help achieve its vision of attainable electric transportation," said Geoffrey Strong, chairman and chief executive officer of Spartan and senior partner, co-head of infrastructure and natural resources at Apollo. 

"Henrik has an unparalleled and world-renowned design track record and is supported by an expert management team with storied careers in the automotive industry. The right team, combined with deep financial resources provided by this transaction, further position the company to succeed in a rapidly growing industry," Strong added.

Fisker plans to use Volkswagen's MEB modular electric vehicle platform for the Ocean SUV in order to cut costs and speed up development time. It also will adopt the German automaker's battery technology.

"Fisker is negotiating with VW to secure a source of battery supply, which would provide Fisker with the benefit of one of the world's largest battery-procurement supply contracts," the company said in a investor presentation.

Prototype versions of the Ocean SUV are expected to start durability testing by the end of this year, Fisker said.

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