Polestar The Electric Vehicle Maker to go Public Via SPAC Merger

Polestar’s shares have begun trading on the Nasdaq under the ticker PSNY. It plans to use the proceeds of the SPAC (a merger with a special purpose acquisition company) deal to fund a global expansion.

The EV maker’s shares ended at $13.00, up 15.8% from the SPAC’s final closing price.

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Polestar CEO Thomas Ingenlath said the company will use the $890 million raised from the deal to fund its three-year plan to build new vehicles and eventually become profitable.

Polestar, which began as a joint venture between Sweden’s Volvo Cars and Chinese auto giant Geely in 2017, has now progressed beyond startup status.

SPAC deals have become a more popular way for companies to go public in recent years. The disclosures required are simpler than those in a traditional initial public offering. Unlike in a traditional IPO, companies participating in a SPAC merger are allowed to present forward-looking projections to investors, which can help justify a lofty valuation. But there’s no guarantee that those forecasts will come true.

Polestar could have several advantages over competitors. Volvo Cars still owns 48% of the company, and Polestar already has more than 55,000 vehicles on the road in China, Europe and the U.S. It has a factory up and running in China and an assembly line set to begin production later this year in a South Carolina factory shared with Volvo.