Lotus will go public via SPAC with $5.4 billion valuation

Lotus Know-how, the electrical-automobile maker owned by China’s Zhejiang Geely Holding Team Co., agreed to merge with a blank-test organization in a transaction that values the put together entity at about $5.4 billion.

L Catterton Asia Acquisition Corp. will incorporate with the EV generating subsidiary of the British carmaking group that Geely acquired again in 2017, the two reported in a assertion Tuesday. The distinctive purpose acquisition company’s sponsor has ties to Bernard Arnault, the world’s richest gentleman.

Lotus Tech has been seeking to go general public since at minimum early very last 12 months. Administration may perhaps have been inspired by yet another luxury vehicle brand’s modern listing: Porsche AG pulled off Europe’s largest initial general public presenting in a 10 years when it debuted in Frankfurt in September. A week afterwards, Porsche overtook Volkswagen AG as Europe’s most precious automaker.

Somewhat than go the IPO route, Lotus Tech will merge with a SPAC whose sponsor combined with the non-public equity operations of Arnault’s luxury-products powerhouse LVMH in 2016. LVMH is a passive minority investor in L Catterton, in accordance to a spokeswoman.

Arnault overtook Tesla Inc. Main Executive Officer Elon Musk as the world’s richest person very last month — the first time a European claimed the major spot on the Bloomberg Billionaires Index.

Although Group Lotus is very small in comparison to Tesla, Geely has been steering it away from combustion engines and has several all-electrical types planned for the coming several years. Lotus Tech sees by itself as a competitor to the likes of Ferrari and Aston Martin, and will get a soar on the 1st electrical products from those people models.

Lotus unveiled its all-electrical Eletre sport utility car previous 12 months and programs to start a rival to Porsche’s well known Taycan EV in 2023.

Geely and other homeowners are envisioned to retain an 89.7% shareholding in Lotus Tech following the SPAC merger. Geely’s billionaire operator Li Shufu also controls Swedish carmaker Volvo Car AB and owns stakes in Germany’s Mercedes-Benz Team AG and the UK’s Aston Martin Lagonda Global Holdings Plc.

Deutsche Financial institution AG recommended Lotus Tech on the deal, although Credit Suisse Team AG acted as money markets adviser to the SPAC.

Relevant movie: