Luxury electric vehicle manufacturer Lotus Technology Co., Ltd. – owned by Geely Group – recently received approval for its IPO filing from the China Securities Regulatory Commission. Lotus Tech is set to list on the Nasdaq in the United States through a merger with the overseas special purpose acquisition company L Catterton Asia Acquisition Corp.
In December 2023, Lotus announced that it had signed agreements for approximately $8.7 billion in private investment in public equity (“PIPE”) financing and convertible notes for 2023. Lotus received commitments for around $7.5 billion in new financing, subject to certain closing conditions specified in the relevant final investment documents. These new financing commitments were in addition to the $1.2 billion financing commitment announced by Lotus on April 28, 2023. All financing agreements were based on a pre-money valuation of $5.5 billion. This will result in an expected free float of over 19% for Lotus (excluding existing LCAA shareholders).
In February 2023, Lotus Technology entered into a merger agreement with the special purpose company L Catterton Asia Acquisition Corp, valuing the new company at $58.88 billion. Originally planned to be completed in the second half of 2023, the merger is expected to lead to the company’s listing on the Nasdaq with the stock symbol “LOT.” However, the chances of the merger and listing happening are slower than anticipated at present.
Lotus Technology was established in August 2021 with its headquarters in the Wuhan Economic Development Zone, known as “China Car Valley”. In August 2021, Lotus announced the establishment of its global headquarters in the Wuhan Economic Development Zone, covering an area of approximately 186 acres with a building area of 390,000 square meters, and a total investment of $3 billion. At that time, Lotus also completed a Pre-A round of financing with a valuation of 15 billion yuan ($2.3 billion), with NIO Capital participating in this round of financing.
In recent years, Geely’s founder Li Shufu has successively taken Volvo, Polestar, and Ecarx Technology and other companies public. In December 2022, Ecarx Technology completed a merger with the special purpose acquisition company COVA Acquisition Corp., listing on the Nasdaq with a valuation of $3.8 billion.
Li Shufu has been adept in the capital markets, with his company Geely Auto also filing for an IPO and preparing to list in the United States with a valuation exceeding $10 billion. However, due to the valuation corrections of NIO and XPeng, coupled with the capital markets not warming up, Geely Auto has yet to list on the NYSE. With Lotus Technology’s IPO approval, it signifies that they have obtained the key to listing.
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