Elon – watch out. Polestar IPO valued at $20 billion

The Deal

The electric-carmaker, Polestar, is set to go public through a merger with Gores Guggenheim Inc via SPAC deal. Whilst the Swedish company have declined to comment, sources believe the valuation will reach $20 billion. Assuming talks don’t fall apart, the deal could be reached as early as Monday. Polestar is jointly controlled by Volvo Cars and the Chinese automotive company Geely.

Why is it so significant?

Despite its immense significance for the EV market, this deal hasn’t made headlines in the business world. Should it go ahead, Polestar would join a swathe of EV companies who have benefited from the boom in blank-cheque companies. This funding will enable Polestar to break into the U.S. market faster, which is currently dominated by Tesla. The CEO of Polestar, Thomas Ingenlath, has emphasised that Polestar will not become a ‘Tesla killer[1]’; however, this capital will enable the company to make its new Polestar 3 a household name.

Who is involved?

The transaction is being led by an all-US line-up, including Kirkland and Ellis, Weil and Gotshal, Hannes Snellman and Davis Polk. Polestar is represented by the most profitable firm in the world, Kirkland and Ellis. Citi, Deutsche Bank, Morgan Stanley, and Guggenheim Securities are acting as joint placement agents for the Private Investment in Public Equity (PIPE).[2]

With fuel shortages becoming a reality for many and EVs starting to fill up the road, this IPO could not come at a better time for the Swedish superpower.

You can read more about the deal here[3] and here[4].

Article by Avishai Marcus

[1] https://investorplace.com/2021/09/spac-alert-9-things-to-know-about-ggpi-stock-and-the-polestar-spac-merger/

[2] https://www.law360.com/capitalmarkets/articles/1425354/4-firms-drive-spac-deal-for-20b-electric-car-co-polestar

[3] https://www.autoweek.com/news/green-cars/a37792147/polestar-spac-plans-are-a-big-deal/

[4] https://thenextweb.com/news/what-the-polestar-spac-means-and-why-it-matters