Harley-Davidson inventory jumped essentially the most in 13 months after the corporate mentioned it could listing its electric-motorcycle unit publicly by means of a merger with a blank-check firm, capping off a busy yr for reverse mergers within the electric-vehicle trade.
The LiveWire division will merge with AEA-Bridges Impression Corp., a particular goal acquisition firm that focuses on sustainability, and is predicted to commerce on the New York Inventory Trade underneath the ticker image “LVW,” the businesses mentioned in a press release Monday. The mixed firm is slated to have an enterprise worth of about $1.77 billion, and LiveWire would reap web proceeds of about $545 million from the deal, in keeping with the assertion.
“At this time’s announcement is a historic milestone with LiveWire set to turn out to be the primary publicly traded EV bike firm within the U.S.,” Jochen Zeitz, Harley’s chief govt officer, mentioned within the assertion. “This transaction will give LiveWire the liberty to fund new product improvement and speed up its go-to-market mannequin.” Zeitz shall be performing CEO of LiveWire for so long as two years after the deal is full.
Harley rose 15% to $42.43 at 9:38 a.m. in New York after climbing as a lot as 18%, essentially the most intraday since late October 2020. The inventory hasn’t loved the run-ups that shares of legacy automakers akin to Ford Motor Co. and Basic Motors Co. have after unveiling electrification plans. Harley was primarily unchanged this yr by means of Dec. 10, whereas GM rose 52% and Ford greater than doubled. AEA-Bridges superior 4.2% to $10.27.
The SPAC deal marks a strategic shift for Harley, which had deliberate to make its flagship electrical bike right into a stand-alone in-house model as a part of its plans to revitalize the corporate. Zeitz’s Hardwire turnaround plan known as for investing $190 million to $250 million yearly partially to develop Harley’s electrification expertise.
LiveWire was established as a separate division of Milwaukee-based Harley-Davidson in 2019 and focuses on the city market in North America and Europe, with plans to increase to Asia.
Though SPAC offers have been widespread this yr, significantly within the EV trade, these usually have been of complete startups, not models of larger firms. Earlier this yr Ardagh Group SA merged its metal-packaging enterprise with a SPAC. Polestar, an electric-car maker based by Volvo Automobile Group and proprietor Zhejiang Geely Holding Group Co., has agreed to go public in a reverse merger.
Harley will retain an fairness curiosity within the new LiveWire of about 74%; AEA-Bridges’ shareholders will personal about 17%, whereas its founders and different companions will personal roughly 4% every.
