Fisker Inc. has been on investors’ radar lately as it negotiates a merger deal with Spartan Energy (NYSE: SPAQ). If this merger succeeds in closing, the company will benefit from a $ 1 billion cash infusion, enough to bring the fully electric Fisker Ocean to market by 2022.
According to the company, the Fisker Ocean will be the most sustainable car in the world, offering a fully electric range of 250 to 300 miles and a vegan interior built from recycled materials. Fisker states on its website that the Ocean SUV will offer the following features:
“The Fisker Ocean will be offered in a four-wheel-drive configuration in all versions except the base model (rear-wheel drive), reflecting the vehicle’s off-road capabilities. The standard four-wheel drive configuration will deliver more than 225 kilowatts (over 300 horsepower), with an ultra-high-performance version that aims at zero to 60 mph in less than three seconds (the total power) in 2021) “.
In a smart move aimed at reducing costs and maximizing efficiency, Fisker has announced that it will partner with other automakers to manufacture and assemble key Ocean EV components. So far, however, these production partners have not been finalized.
This brings us to the heart of the matter. Henrik Fisker, president and CEO of Fisker Inc., announced in a tweet on July 22 that the company would disclose the number of reservations the Ocean SUV has accumulated through July 30:
We will launch our bookings and customer interests on July 30 for our 2022 Fisker Ocean EV. We take $ 250, – deposits. Ver👉🏽 https://t.co/ywdczefXB1 —- # fisker #love #EVs #art #design $ SPAQ #architecture #emobility #solar #supercar #auto pic.twitter.com/PnpTEsNHpk
– Henrik Fisker (@henrikfisker) July 21, 2020
Well, the numbers were released a few moments ago and are encouraging. According to Fisker, the company has accumulated more than 30,000 registered users to date. It should be noted, however, that the company had registered 22,000 expressions of interest for the Ocean EV in April.
The Fisker Fam is now a community of over 30,000 registered users in 30 countries, with more than 7,000 advance bookings for the Fisker Ocean. Thank you for joining us on this journey and for a clean future for all. # Fisker #electricvehicles #spaq pic.twitter.com/fdkzorVVKK
– Fisker Inc. (@FiskerInc) July 31, 2020
In comparison, Nikola’s (NASDAQ: NKLA) Badger electric van managed to earn fewer than 5,000 bookings within 4 days of the opening of the booking process. On the other hand, Tesla’s Cybertruck (NASDAQ: TSLA) recorded 146,000 bookings within 2 days of the start of installation.
In addition to the reservation numbers for the Ocean EV, Fisker has also announced that an additional 3 EVs will be brought to market starting in 2023.
While Fisker Ocean’s reserve numbers signify a considerable amount of interest, investors are now likely to focus their attention on the ongoing merger process between Fisker and Spartan Energy, a Special Purpose Acquisition Company (SPAC). As previously explained, a SPAC is formed for the sole purpose of raising capital through an IPO and then channeling these proceeds from the IPO to acquire an existing business. The deal is expected to close in the fourth quarter of 2020 and will likely be worth $ 2.9 billion, including $ 500 million in PIPE investment. As a reminder, a Private Investment in Public Capital (PIPE) is the purchase of shares of publicly traded shares at a discount to the current market price by institutional investors. The mechanism aims to reward these investors for providing a liquidity infusion.
To this end, Spartan Energy filed a Definitive Statement of Representation (DEF 14A) on July 23 with the US SEC, followed by a modified Statement of Representation (DEFA 14A) on July 28. According to the July 28 presentation, existing Spartan Energy shareholders have been invited to a special meeting on August 3 to vote on the amendment to the SPAC bylaws. This amendment will be extended “The date on which the Company must complete a business combination for an additional six months, from August 14, 2020 to February 14, 2021”.
The move makes sense since Fisker’s merger with Spartan Energy will in all likelihood not be completed by the existing deadline of August 14. If the proposal is not approved, the submission indicates that the following course of action will be adopted:
“If the Charter Amendment proposal is not approved at the special meeting or any postponement or postponement thereof and we do not consummate a business combination before August 14, 2020, as contemplated by our initial public offering and In accordance with our letter, we will (i) cease all operations except for the purpose of liquidation, (ii) as soon as reasonably possible but no more than ten business days thereafter, exchange the shares of our common shares Class A sold as part of the units in our IPO, at a price per share, payable in cash, equal to the total amount deposited in the trust account established for the benefit of the holders of our public shares … “
In a crucial caveat, the introductory notes:
“Holders of public shares may elect to exchange their shares for their pro rata share of the funds available in the trust account in connection with the Charter Amendment, regardless of whether or not such public shareholders vote on the Amendment of the letter.
This means that Spartan Energy shareholders will be able to exchange their shares regardless of the approval or rejection of the bylaws amendment, receiving approximately $ 10.31 per redeemed share. Given the broad implications of the vote, Fisker’s analysts and enthusiasts are likely to continue to closely follow developments on this front.
