Strictly a rumor; definitely not a recommendation. Hennessy Capital Acquisition Corp. (stock symbol: HCAC), a SPAC that raised approximately $300 million when it went public in February 2019, is rumored to be in discussions to merge with Canoo, a company that intends to offer an electric vehicle on a subscription basis. HCAC closed at $11.13 on Friday.
EV Startup Canoo Is Said to Be In Talks for Hennessy SPAC Deal
Gillian Tan and Kiel Porter, Bloomberg News
August 7, 2020
An electric charging plug sits connected to a BMW automobile inside a Bayerische Motoren Werke AG showroom in Frankfurt, Germany, on Tuesday, Aug. 4, 2020. The German automaker said it is seeking to reduce CO2 output per car by at least a third by 2030, and track progress via raw material sourcing, production and road emissions. Photographer: Peter Juelich/Bloomberg , Bloomberg
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(Bloomberg) -- Hennessy Capital Acquisition Corp. IV is in advanced talks to merge with Canoo, a company that intends to offer electric vehicles on a subscription basis, according to people with knowledge of the matter.
The special purpose acquisition company, or SPAC, is in talks with investors to raise about $300 million in new equity for the deal, which would take Canoo public and value the combined entity at more than $2 billion, said the people, who asked not to be identified because the talks are private.
Terms of a deal haven’t been finalized and the talks could still fall apart, the people said.
A spokeswoman for Canoo declined to comment. A representative for Hennessy didn’t immediately respond to a request for comment.
In a filing seeking an extension of a September deadline for finding a company to acquire, Hennessy said in July that it had “entered into a letter of intent with a prospective target for an initial business combination in the electric vehicle and advanced mobility sector.” The SPAC cautioned that there can be “no assurance that a definitive agreement will be entered into or that the proposed transaction will be consummated.”
Canoo, based in Southern California, has said it plans to begin selling its first vehicle next year. The company, founded in 2017, is led by Ulrich Kranz. Former chief executive officer and co-founder Stefan Krause, once a Deutsche Bank executive, left the company earlier this year.
Deals involving autonomous driving technology and electric vehicles have been in favor among blank-check companies. In deals announced last month, Velodyne Lidar Inc. and Fisker Inc. both agreed to go public via SPAC mergers.
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