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The fast chargers are expected to be available in supermarkets, retail stores, entertainment centers and other high-traffic locations. Drivers can easily charge their car at an EVgo station while doing their shopping.
Credit to GM
The famous line from the classic baseball movie Field of Dreams is: When you build it, they come. In the case of the electric car industry, the line has to go: they’re coming, so you better build it.
New and old carmakers plan to bring dozens of all-electric vehicles to market in the coming years, capitalizing on the incredible success of
Tesla
(ticker: TSLA). That means more demand for public charging infrastructure for electric vehicles from drivers who want to charge on the go.
In order for the adoption of electric vehicles to grow rapidly, the charging infrastructure will also have to keep up with car sales. Seeing more plugs around town can convince buyers sitting on the fence to switch from internal combustion to battery power with less sacrifice.
EVgo is a company that can help solve the chicken and egg dilemma. The California-based startup is merging with a specialty acquisition company, or SPAC
Crisis climate change Real impact I Takeover
(CLII) or CRIS. The transaction, announced Friday, will bring EVgo to the public, giving investors a chance to drive. It will also provide EVgo with approximately $ 575 million in new capital to accelerate construction of its nationwide fast-charging network. The company says it currently has more than 800 chargers in 34 states and 220,000 customers.
The difference between slow and fast charging stations – which can also be charge level 2 and charge level 3 – boils down to how much electricity the charger can safely pump into the EV’s batteries. That rate depends on the hardware in the car, but also on the charging infrastructure for electric cars.
Stock market investors who don’t drive electric vehicles may have heard of EVgo before Friday.
General engines
(GM) partnered with the company last summer and announced plans to add more than 2,700 fast charging stations over the next five years. GM wants to sell many more electric vehicles in the coming years, and having the infrastructure for new battery-powered cars will help, the thinking goes.
EVgo chargers are suitable for cars of any manufacturer and are located in supermarket parking lots, outside office buildings and on city streets. The company caters to daily commuters as well as commercial operators. EVgo has partnerships with
Uber Technologies
(UBER) and
Lift
(LYFT) for their ride-share drivers to charge their EVs.
“The EV market is expected to grow 100 times between now and 2040,” said EVgo CEO Cathy Zoi Barron’s. “So the need for charging those vehicles, and especially fast charging, will increase phenomenally … More different types of people will buy electric vehicles that don’t have a charging point at home, more commercial fleets will have electric vehicles, and the cars themselves will be bigger and heavier. , so they need more juice. “
There are other EV charging companies, including
Flashing charging
(BLNK) and
Beam Global
(BEEM). Blink’s market capitalization is approximately $ 1.9 billion. The bar is smaller with a market value of about $ 450 million.
Both are currently smaller than EVgo. Zoi did not address any competitor directly, but expressed confidence in her company’s technology and service capabilities, including call centers to solve customers’ problems, charging station control software, and advanced hardware designed to take the time required. is to keep a battery charging to a minimum. EV.
The CRIS-EVgo deal values the combined share at approximately $ 2.6 billion. Proceeds include the $ 230 million in SPAC’s climate change-focused trust, plus a $ 400 million private investment in public equity, or PIPE. The PIPE funders include a selection of major institutional investors: funds managed by Pimco,
Black rock,
Wellington Management, Neuberger Berman and Van Eck. All come in at $ 10 a share, while CRIS shares close at $ 13.34 on Thursday.
CRIS, which went public on September 30, and several other renewable energy, climate change and electric vehicle-related premerger SPACs have been trading well above their confidence levels in recent months.
QuantumScape
(QS),
Hyliion
(HYLN), and
Nikola
(NKLA) all saw their stock prices multiply after their SPAC mergers in 2020, and investors wanted the next hot deal early on.
Existing shareholders of EVgo – including management and energy-focused investment firm LS Power – will own approximately 74% of the merged entity. Pending shareholder approval, CRIS shares will be converted to EVgo shares and the ticker will change to “EVGO.”
(
Canoo,
an EV maker that has merged with another SPAC now has a stock symbol ‘GOEV’.)
“It is almost a certainty for me that this addressable market will be realized,” said David Crane, the CEO of CRIS who was CEO of NRG Energy (NRG) from 2003 to 2015. “It’s not like this industry needs a massive breakthrough that might not happen.”
Automakers have committed hundreds of billions of dollars to their EV programs, and governments are committed to transforming the industry from carbon-emitting vehicles that use both carrot and stick. The Biden government has talked about installing half a million charging stations in the US, and consumers are happy to drive electric vehicles.
Investors have also become convinced that electric vehicles are the future of personal transportation. Various EV stocks Barron’s tracks have increased about 500% on average in the past year. Tesla is now by a wide margin the world’s most valuable car manufacturer. And EV manufacturers are worth about the same overall value as all traditional car manufacturers, despite supplying a fraction of the vehicles.
Write to Al Root at [email protected] and Nicholas Jasinski at [email protected]