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Groundhog Day is still a week away, but this story will make you feel like Bill Murray trapped in a time loop.
EVgo, an electric vehicle charging station startup, is going public by way of a merger with a SPAC called “Climate Change Crisis Real Impact I.”
The déjà vu you’re experiencing is real. EVgo is joining a long list of EV companies to pull the same move: Arrival, Canoo, Fisker, Lordstown Motors, Proterra and The Lion Electric Company over just the last 8 months.
Chicken Or The Egg
Founded in 2010 as a subsidiary of energy giant NRG, EVgo currently has 800 chargers in 34 states, boasting 220,000 customers.
The company’s “fast chargers” are compatible with cars from any manufacturer and will be located in highly-trafficked locations such as grocery store parking lots, office buildings, and city streets.
While the company is new to the public markets, you may have heard of it before:
- Last summer General Motors partnered with EVgo planning to add more than 2,700 fast charging stations over the next five years.
- EVgo also has partnerships with Uber and Lyft for ride-share drivers to charge their EVs.
Deal Details: The deal values EVgo at a hefty $2.6 billion. On top of $230 million of proceeds from the SPAC, EVgo will raise $400 million in a “pipe” (private investment in a public vehicle) from the likes of BlackRock, Pimco, and Wellington Management. PIPE investors were able to nab a 25% discount vs. Thursday’s closing price (a lot of people are high fiving their accountants for this one).
Biden Their Time
The listing comes at a fortuitous moment for EVgo, as the new U.S. administration is set to push for more of exactly what it does. During the 2020 campaign, President Joe Biden promised to add 500,000 public chargers across the country to help transition drivers off gasoline.
Meanwhile, auto manufacturers in the private sector are preparing to launch dozens of new electric vehicles, following on the success of Tesla. EVgo has already teamed with General Motors to add 2,700 fast charging stations in the next five years.
Last year EVgo did roughly $14 million of revenue. With a $2.6 billion valuation, this investment is #speculative.