Lordstown Motors Corp. to List on NASDAQ - Fuel Smarts

Andrew Cummings
August 5, 2020

The state of play: Lordstown, which plans to build a pickup truck at a former GM plant in OH, on Monday announced a merger agreement with DiamondPeak Holdings. Zero-emission vehicle startups Nikola Motors and Fisker Inc. are undertaking similar mergers to go public.

Under the deal, which implies a $1.6 billion valuation for the company, Lordstown Motors will receive $500 million in financing (through a private investment in public equity) from Fidelity, Wellington Management, the Federated Hermes Kaufmann Small Cap Fund, and funds managed by BlackRock.

The deal is expected to close in the fourth quarter of 2020 upon which the merged company will retain the Lordstown name and list on Nasdaq under the ticker symbol "RIDE".

Lordstown has an interesting history for such a young company.

The Endurance will have an electric driving range of 250 miles and a price tag of $45,000 net of a federal tax credit, Lordstown CEO Steve Burns said on a call.

Lordstown Motors unveiled the electric Endurance pickup in June and has received 27K orders from mainly commercial fleet customers. Lordstown Motors acquired in November the 6.2 million-square-foot factory from GM.

According to Monday's press release, $675 million of expected gross proceeds will be used for the development and commercialization of Lordstown's all-electric pickup, called the Lordstown Endurance.

With 27,000 advance orders worth 1.4 billion dollars, this equates to around 52,000 dollars per vehicle And since Lordstown has said is only expecting an initial production of 20,000 vehicles per year, the first year's production would already be sold out, provided the company can also convert the reservations into binding orders. The plant has the capacity to build 600,000 vehicles annually, which Lordstown in the future could fill with additional vehicles like SUVs and a mid-size pickup truck.

David Hamamoto, chairman and CEO of DiamondPeak, added, "We have evaluated hundreds of companies for more than a year and Lordstown stood out as a differentiated, high growth company at the confluence of electric vehicles and light-duty trucks, two highly valuable areas of focus and tremendous opportunity in the automotive sector".

Lordstown said the battery-powered Endurance gets the gasoline equivalent of 75 mpg.

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