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(Bloomberg) – Lordstown Motors Corp., the commissioning of electric trucks that intervened to save a closed plant of General Motors Co. in Ohio, it will be indexed on the Nasdaq and you’ll get an infusion of $675 million per merger with a publicly traded company. investment vehicle.
The company will trade under the symbol RIDE after the deal with DiamondPeak Holdings, he said monday. Lordstown plans to use the proceeds to finance the production of its Endurance electric pickup truck at GM’s former plant, which is expected to begin at the time of next year.
The startup’s agreement with the blank check company is the latest in a series of opposing mergers that have overcharged electric vehicle startups with little or no gain when making them public in a singles transaction. So-called special target purchasing corporations have acquired and financed the ambitions of the Nikola Inc. and Fisker Inc. electric vehicle brands in recent months.
“This brings us to the end,” Steve Burns, founder and CEO of Lordstown Motors, said in a phone interview. “This will allow us to start production and also help us bring new models faster than we could have done.”
The transaction, which is expected to close in the fourth quarter, includes a $75 million investment from GM. The combined entity would be $1.6 billion, Lordstown said. GM’s share will be significant but less than 10%, Burns said.
DiamondPeak is controlled through David Hamamoto, former Northstar Realty, and Mark A. Walsh, former Lehman Brothers real estate banker and now a spouse in the Silverpeak investment fund. DiamondPeak shares rose 17% to $11.95 at 9:32 a.m. in New York. Workhorse Group Inc., which holds a small stake in Lordstown Motors, rose 5.7% and Nikola’s shares rose 6.3%.
Lordstown Motors bought the plant after GM closed the plant, which was founded in 1966. Its closure was a duty to U.S. President Donald Trump, who a year earlier came to deter rally enthusiasts from promoting their homes because of all jobs. would bring back to the region.
Burns said he would supply the plant with subcontractors as he prepared to begin production, but would not be able to replace them with full-time staff. He said he’ll want six hundred production employees and 400 engineers to operate the former Lordstown plant.
When GM manufactured the compact Chevrolet Cruze at the plant, it hired about 3,000 employees in multiple shifts. It reduced production as demand for small cars declined and closed the plant in 2019.
Its plan is to build 20,000 trucks in the first full year of production. The company has a consumer’s letter of intent for 27,000 vehicles, he said.
The transaction also includes funding from Fidelity Management – Research Co., Wellington Management Co., Federated Hermes Kaufmann Small Cap Fund and budget and accounts controlled through BlackRock Inc., among others. Goldman Sachs is DiamondPeak’s exclusive monetary advisor, and Deutsche Bank acts as an additional advisor on capital markets.
(Updates with inventory in the sixth paragraph)
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