Electrical truck chassis maker Xos Vehicles goes public with clean test backing from a particular function acquisition firm (SPAC). Xos will merge with NextGen Acquisition Corp. at an implied market capitalization of $2 billion.
North Hollywood, California-based Xos will get $575 million raised by NextGen (NASDAQ:NGAC) . NextGen raised $335 million by an preliminary public providing wherein buyers gave NextGen a “clean test” to pursue a merger. One other further $220 million got here through a personal funding in public fairness (PIPE).
The proceeds for Xos assume no NextGen buyers redeem shares earlier than the enterprise mixture is accomplished within the second quarter. If he merger goes by, NGAC shares would commerce underneath the ticker image XOS.
Xos makes a customizable chassis with the wiring, battery mounting and axle-mounting methods for medium- and heavy-duty electrical vans. Its prospects embrace United Parcel Service (NYSE: UPS), armored truck firm Loomis and Japan’s Hino Motors Ltd., a subsidiary of Toyota Motor Corp. (NYSE: TM)
Xos claims a backlog of 6,000 orders, together with an order for 100 vans from Thompson Truck Facilities, a subsidiary of Thompson Machinery, headquartered in Nashville, Tennessee. The 2 firms are focusing on 1,000 medium- and heavy-duty vans over the following three years. A lot of the our bodies are anticipated to be constructed by Morgan Olson, an Xos spokeswoman stated.
Xos additionally gives fleet-as-a-service (FaaS), which for a hard and fast month-to-month payment bundles financing and upkeep. FaaS is projected to extend Xos’ lifetime income per automobile. In an analogous scheme, Nikola Corp. (NASDAQ: NKLA) plans to supply gas cell Class 8 vans, upkeep and hydrogen gas for seven years for a set worth.
“In the present day’s announcement represents a significant milestone that permits Xos to develop its automobile and battery manufacturing capability, advance our next-generation battery and automobile management methods and put hundreds extra Xos automobiles on the street,” Giodano Sordoni, Xos co-founder and chief working officer, stated in a press release.
Xos started in 2016 as Thor Vehicles. Its first prototype, a Class 8 day cab constructed on its electrified chassis, introduced comparisons to the Tesla (NASDAQ: TSLA) semi launched just a few weeks earlier in 2017. The Semi has been delayed quite a few occasions past its unique 2019 manufacturing goal.
Xos gave up the Thor identify in a trademark dispute with leisure automobile maker Thor Motor Coach in 2019. Across the identical time, it pivoted to deal with Class 5-7 medium-duty vans. Class 8 vans are on the again burner. However they continue to be in Xos’ plans, co-founder and CEO Dakota Semler informed FreightWaves in a Could 2020 interview.
“Our purpose was to supply prospects a superior different to conventional fossil gas automobiles,” Semler stated in Monday’s launch. “As former fleet operators, we gained a deep appreciation for the challenges of working and sustaining industrial fleets, significantly in mild of accelerating emissions necessities.”
The SPAC search
NextGen reviewed greater than 100 merger alternatives earlier than selecting Xos. The expansion in e-commerce and last-mile transportation factored closely in its alternative.
“The sturdy secular tailwinds of local weather change and e-commerce anchor our funding conviction in Xos,” stated George Mattson, co-founder and co-chairman of NextGen and a former companion at Goldman, Sachs & Co.
“Local weather change is among the world’s best challenges. And industrial vans are the biggest emitters per capita of greenhouse gases within the transportation trade,” Mattson stated.
Semler and Sordoni, together with Chief Expertise Officer Robert Ferber and Chief Monetary Officer Kingsley Afemikhe, will proceed to steer Xos. Semler and Sordoni shall be firm administrators together with Mattson on a newly fashioned board of administrators. NextGen guarantees Xos steerage in strategic, working and governance expertise.
“Based mostly on our work, we consider that Xos is finest positioned to seize the quickly rising demand for industrial electrical automobiles with a compelling buyer providing,” stated Gregory Summe, NextGen co-founder and co-chairman.
Summe is former Chairman and CEO of life sciences firm PerkinElmer Inc. He additionally was vice chairman of the Carlyle Group non-public fairness agency.
The Xos discussions with NextGen have been first reported by Reuters on Feb. 8.
Xos Vehicles could also be subsequent to go public through SPAC: Reuters
DLL companions with Xos on electrical truck financing
Xos electrical truck startup edging towards low-volume manufacturing
Click on for extra FreightWaves articles by Alan Adler.