Microvast.
- Special purpose acquisition company Tuscan Holdings will merge with EV battery maker Microvast.
- The transaction leaves the company with a combined valuation of roughly $3 billion.
- “In Microvast, we have found a disruptive technology company operating in a large, addressable market with a long runway of future growth,” said Stephen Vogel, CEO of Tuscan.
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Tuscan Holdings soared over 40% on Monday morning after the special purpose acquisition company announced it will merge with EV battery maker Microvast.
The deal values the combined company at roughly $3 billion and will leave the entity with $822 million in gross cash proceeds.
That cash includes a $540 million investment led by Oshkosh, BlackRock, Koch Strategic Platforms, and InterPrivate Capital, according to a statement.
The new company will trade in the Nasdaq under the ticker symbol “MVST.”
Microvast provides next-generation battery technology for commercial and specialty electric vehicles. The company's batteries have been integrated into almost 30,000 vehicles to date, and its proprietary intellectual property portfolio includes more than 550 patents.
Tuscan holdings, led by Stephen Vogel, had originally been in the market to merge with a cannabis company, raising $276 million in March 2019 and going public with that intention. However, with the EV boom of late, many SPACs are trying to take advantage.
From Chamath Palihapitiya's Arclight-Proterra merger to the potential Churchill Capital IV-Lucid Motors merger, SPACs are finding worthwhile partners in EV companies.
Read more: Hedge fund phenom Dan Sundheim's D1 Capital has been stung by the AMC short bet caught up in Reddit's trading frenzy.
"In Microvast, we have found a disruptive technology company operating in a large, addressable market with a long runway of future growth that has developed long-term competitive advantages and has established a multi-year track record of proving its capabilities," said Stephen Vogel, Chairman and CEO of Tuscan.
The deal with Microvast is expected to close sometime in the second quarter of 2021 and will see Mr. Yang Wu, CEO of Microvast, stay on to lead the combined team going forward.
One of the lead investors, InterPrivate Capital, who also managed a SPAC recently signing a merger agreement with the Lidar company Aeva in November, said the combination would be ideal for Tuscan going forward.
"The Microvast team has not only developed cutting-edge battery technology that is highly attractive to its suite of market-leading customers and partners, generating over $100 million in 2020 revenue, but also operates a vertically integrated production process for its battery solutions that is unique in the industry, enabling both enhanced customer service and the opportunity to achieve excellent margins," said Ahmed Fattouh, CEO of InterPrivate Capital.
Shares of Tuscan Holdings traded at $22.09 before the open on Monday, as of 8:53 AM EST.