Xos goes public through $ 2 billion SPAC deal with (NGAC) NextGen Acquisition Corp.

Xos, an electric utility vehicle manufacturer, has agreed to go public through a merger with a blank check company, NextGen Acquisition Corp., according to a statement reviewed by Bloomberg News.

The deal values ​​its combined equity at $ 2 billion, the companies added.

To support the transaction, the special purpose acquisition company will raise $ 220 million from investors, including Janus Henderson Group Plc and a group of truck dealers led by Thompson Truck Centers.

Some of Xos customers are inclusive United Parcel Service Inc., armored car service company Loomis AB and transport company Lonestar.

Dakota Semler, co-founder and CEO of Xos, said in an interview that the Los Angeles-based company has other distribution partnerships that have not yet been announced. Semler said states like California, which are phasing out cars that produce emissions, will help increase demand for commercial electric vehicles like Xos.

“Fleets have to plan for this and make that transition,” said Semler.

The deal will net the company $ 575 million in gross proceeds, the statement said

“That money will be used to build vehicle assembly and battery production capacity and to continue to work on the next generation of battery systems and other technologies,” said George Mattson, a former Goldman Sachs Group Inc. banker who founded the NextGen SPAC and joins the board of Xos.

He added that the company is expected to have positive cash flow by 2023.

SPAC EV Parade

A parade of electric vehicle manufacturers has struck deals with SPACs as startups seek to grow and raise money to help develop their products and gain an edge in an increasingly competitive space. Another electric truck maker Lion Electric Inc. announced it would go public through an SPAC this year.