November 29, 2020


Arrival, the UK electric bus and van maker backed by Hyundai, will list in the US through a reverse takeover, valuing the company at $5.4bn.

The group said on Wednesday it will merge with Nasdaq-listed CIIG Merger Corp, a special purpose acquisition company, or Spac, a blank-cheque company that enables businesses to list without the usual scrutiny of a traditional initial public offering.

The company is the latest to enter the electric van market, pitting it against Ford, which this month unveiled its electric Transit van, and start-ups such as Rivian, which is making battery-powered delivery vans for Amazon.

Arrival’s valuation is a steep rise since January, when a €100m investment by South Korean groups Hyundai and Kia valued the company at €3bn.

The business, which will produce fully electric buses and vans from a series of “microfactories”, has $1.2bn in a firm order from UPS as well as several other late-stage discussions with potential customers, president Avinash Rugoobur told the Financial Times.

“The timing is right, the technology is mature, we have had prototypes on the road for two years, and we understand the challenges that are ahead of us,” he said.

As part of the merger, CIIG chief executive Peter Cuneo, who revitalised brands including Black & Decker and Marvel, will join Arrival’s board as its non-executive chairman.

“Arrival’s bold, game-changing approach to the production of electric vehicles made the company the clear winner in our search for a partner,” said Mr Cuneo.

Mr Rugoobur said Mr Cuneo would help the company to develop its brand as it aims to expand across the world.

Despite its order book, the business is not due to begin production of its first bus until the final quarter of 2021, with its electric van coming in 2022.

It also has plans to co-develop electric vehicles with Hyundai and Kia.

Arrival will raise $660m in proceeds through the listing, allowing it to increase factory openings in the US and Europe once its production has started.

CIIG has raised $400m from investors including Fidelity Management & Research Company, Wellington Management, BNP Paribas Asset Management Energy Transition Fund, and funds and accounts managed by BlackRock.

UPS and BlackRock are already investors in the company.

“We will raise enough capital here to see us through to being cash flow positive by 2023,” said Mr Rugoobur.

The company plans to open a network of small factories making 10,000 vehicles each, allowing it to build plants faster and more cheaply than traditional sites that turn out hundreds of thousands of vehicles a year.

“If you look at the microfactory concept, upfront it requires significantly less capital, but if we were taking a traditional carmaker approach we would need billions,” he said.

It already has two sites planned, in South Carolina and in Bicester, Oxfordshire, and expects to open three or four a year once production starts.

Former General Motors strategy


LONDON — British electric vehicle start-up Arrival announced Wednesday that it will go public through a merger with a U.S. blank-check company.

This year has seen a flurry of SPACs, or special purpose acquisition companies, come to market as businesses have shunned the traditional initial public offering process. SPACs are companies that raise funds to finance a merger deal that takes the target firm public.

In Arrival’s case, the London-based company is set to combine with CIIG Merger Corp, a SPAC set up by U.S. businessman Peter Cuneo. Cuneo previously ran the American personal care brand Remington and comic book publisher Marvel as CEO. He will join Arrival’s board as non-executive chairman, while founder Denis Sverdlov will remain as CEO.

The deal gives Arrival an enterprise value of $5.4 billion — it was last privately valued at 3 billion euros ($3.5 billion) in January — with the combined company expected to raise a total of $660 million in gross cash proceeds. Arrival will list on the Nasdaq under the ticker symbol “ARVL,” with the deal expected to close by early 2021.

What is Arrival?

Arrival competes with Rivian, a company that has won backing from Amazon, in the electric van space. It received a massive order to the tune of 10,000 vehicles from U.S. parcel service UPS, which is also an investor in the company. Arrival’s other backers include Hyundai, Kia and BlackRock.

Arrival says it stands out from other electric vehicle makers as it’s purely focused on the commercial market rather than selling to consumers. Founded in 2015, Arrival says its technology is “vertically integrated” all the way from production to development.

Its two main vehicle products are vans and buses. Avinash Rugoobur, Arrival’s president, told CNBC that it expects to start production on its bus in the fourth quarter of next year, while van production will begin in the second quarter of 2022.

“Our technology is at a maturity level where we’re looking to scale the company rapidly now,” Rugoobur told CNBC in an interview Wednesday.


Rugoobur added that the rise in the market value of Elon Musk’s electric car company Tesla — which is now the world’s most valuable automaker — was a validation of the green energy transition. Arrival’s vehicles can be sold for a price point similar to — and even cheaper than — that of diesel vehicles, he said.

Another thing that the company says makes it unique is its production model. The firm has developed what it calls “microfactories” which are much smaller than traditional auto production lines and can be packed into existing warehouse real estate.

It is aiming to make three to four of these factories — which take up about 20,000 square meters of space and cost $45 million to make — per year.

SPACs have proven an increasingly popular way for companies to list in the U.S., with a number of businesses from space transportation firm Momentus to direct-to-consumer health company Hims merging with blank-check firms.

Nikola, one