Electric car maker Polestar lands $20bn deal to go public

Swedish Polestar announces plans to go public via SPAC merger with Gores Guggenheim Inc.

Polestar CEO Thomas Ingenlath in a car showroom                                 
Polestar CEO Thomas Ingenlath – Photo: Shutterstock
                                

Swedish electric vehicle maker Polestar has announced plans to go public via a SPAC merger with Gores Guggenheim, Inc. 

The transaction includes $800m in cash from Gores Guggenheim at a $20bn enterprise valuation.

The merger will form a new public company named Polestar Automotive Holding UK Limited and is expected to be listed on Nasdaq under the ticker symbol “PSNY”, Polestar confirmed in a statement.

Polestars investors include Volvo Car Group and affiliates of Geely Chairman Eric Li and actor Leonardo DiCaprio, among others.

Setting new standards

Europe has emerged as the second-largest electric vehicle market in the world by volume, behind China and ahead of the United States, according to the ICCT.

The demand for electric vehicles has seen a sharp increase worldwide in a bid to combat climate change and emissions within the transportation sector. According to The Guardian, global sales of electric cars hit a record high in 2020, with a 43% increase to more than three million sales, despite overall car sales decreasing by a fifth during the coronavirus pandemic. 

Electric vehicles also provide a more sustainable approach to vehicle production with lower production costs and hybrid charging infrastructures.

Founded in 2017 by Volvo Cars and Zhejiang Geely Holding, the Nasdaq-bound business plans to expand its global distribution footprint to 30 markets by 2023. It has delivered approximately 10,000 vehicles in 2020 and expects to sell approximately 290,000 vehicles a year by 2025. 

Thomas Ingenlath, CEO of Polestar, commented on the announcement: “This is a really exciting time for Polestar. In Alec and the Gores Guggenheim team, we have found a partner with an impressive track record of bringing leading companies to the public markets.

“The proposed business combination and listing position Polestar as a financially strong, future proof, global electric car company. It will enable us to accelerate our growth, strategy and most importantly, our mission towards sustainable mobility,” Ingenlath added. 

Further reading: WMG stock forecast: How is Warners responding to the Universal IPO?

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