ChargePoint, a U.S.-based electric charging network company, announced that it had signed a definitive business combination agreement with publicly traded special-purpose acquisition company Switchback Energy Acquisition Corporation.
The transaction is expected to be completed by the end of the fourth quarter of 2020, according to its press statement. The company will be named ChargePoint Holdings Corporation and listed on the New York Stock Exchange upon completing the transaction. Pasquale Romano, the President, and CEO, and the existing management team will continue to lead the company.
The business combination has valued ChargePoint at $2.4 billion enterprise value. After the closing of the transaction, ChargePoint will have approximately $683 million in cash, resulting in a pro forma equity value of about $3 billion. Cash proceeds raised in the transaction will be used to repay debt, fund operations, support growth, and utilized for general corporate purposes.
The proceeds will be financed through $317 million in cash from Switchback and $225 million through private investment in public equity (PIPE) of common stock valued at $10/share. PIPE refers to the practice of buying shares of a publicly-traded stock at a price lower than the current market value.
The electric charging network company said that the net proceeds of around $493 million would be utilized to expand its portfolio in North America and Europe, to enhance technology, and to scale its commercial, fleet, and residential business.
“The electric vehicle charging industry is accelerating, and it is expected that charging infrastructure investment will be $190 billion by 2030. As a first-mover in the space, ChargePoint is well-positioned to deliver critical charging infrastructure as expected transition to electric mobility accelerates,” said Scott McNeill, CEO, CFO, and Director of Switch Bank Energy Acquisition Corporation.
ChargePoint currently holds over 115,000 public and private charging stations globally. It also provides 133,000 public places to charge electric vehicles through network roaming collaboration in Europe and North America.
According to Mercom Capital Group’s Battery Storage, Smart Grid and Efficiency Funding and M&A Report, about $897.5 million has been raised by smart charging of plug-in hybrid vehicles (PHEV) and vehicle to grid (V2G) technology companies since 2012.
ChargePoint has so far raised 575.10 million in funding. Recently the company secured $127 million in incremental equity financing.
Image credit: ChargePoint
Harsh is a staff reporter at Mercom India. Previously with Indian Express, he has covered general interest stories. He holds a Masters Degree in Journalism from Symbiosis Institute of Media and Communication, Pune.