Alexei Nikolsky/RIA Novosti/Pool/Reuters
- Ex-Russian minister Denis Sverdlov is set to profit massively from his firm Arrival's merger with a SPAC.
- The electric-vehicle maker is worth about $15.3 billion, in a sign of lofty valuations in green tech.
- Shareholders in the CIIG Merger SPAC will vote on the Arrival deal on Friday.
- See more stories on Insider's business page.
A former Russian minister is set to win big from the craze for both electric vehicles and blank-check companies, notching up a reported 3,000% gain by taking his company Arrival public via a SPAC.
Shareholders in the special-purpose acquisition company CIIG Merger Corp will vote on Friday on its merger with British-American electric-vehicle firm Arrival, which was announced in November.
The combined company will list on the Nasdaq with the ticker ARVL. Arrival is now valued at around $15.3 billion, based on the price of the CIIG SPAC with which it's merging. That makes it worth more than half of the UK's blue-chip FTSE 100 stock index.
Bloomberg reported Sverdlov will soon have a net worth of $11.7 billion. That is thanks to his hefty 76% stake in the new combined company.
That would be a roughly 3,000% return on Sverdlov's investments in his company, which specializes in making electric vans and buses and has recently signed a deal with UPS, Bloomberg said.
It is the latest instance of the craze for special-purpose acquisition companies making people extremely rich.
SPACs launched in 2021 have now raised more money than those listed in the whole of 2020, at more than $83 billion.
A SPAC is an entity that exists solely to list on the stock exchange to raise money, in the hope of finding and merging with a target company to take it public.
The model can be extremely lucrative for the owners of the companies that go public as well as the initial sponsors of the SPAC, who take a big stake for a small sum - often 20% for a nominal price of $25,000.
For example, billionaire Alec Gores reportedly turned one $25,000 stake into an $80 million payout after a SPAC deal with United Wholesale Mortgage.
The deal for Arrival, which is yet to fully scale up production, is also a sign of the huge increase in the value of electric vehicle companies. Pack-leader Tesla has soared more than 600% over the past year as investors rush to get a piece of new green technologies.
A spokesperson for Arrival was contacted for comment.