Lotus Technology, a subsidiary of China‘s Zhejiang Geely Holding Group Co., has decided to merge with a blank-check company in a deal worth approximately $5.4 billion.
L Catterton Asia Acquisition Corp. will merge with the EV manufacturing corporation of the British carmaking group Geely. The sponsor of the unique purpose acquisition company has ties to Bernard Arnault, the world’s richest man.
Lotus Tech to go public
Lotus Tech has been considering going official since at least early last year. There is a precedent of a recent successful listing of another luxury automaker. Porsche AG pulled off Europe‘s most extensive first public offering in a decade when it was came into market last September (2022).
A week later, Porsche surpassed parent company Volkswagen AG as Europe’s most significant automaker.
A luxury contender
Bernard Arnault surpassed Tesla‘s Elon Musk, to be named the world’s richest man last month, marking the first time a European had topped the Bloomberg Billionaires Index.
Since Group Lotus is insignificant compared to Tesla, Geely has been steering the company away from diesel engines, with many all-electric models in the works for the coming years.
Lotus Tech sees itself as a contender to Ferrari and Aston Martin and will have a head start on those companies’ first electric models.
Lotus Electre SUV to compete with Porsche Taycan EV
Lotus revealed its all-electric Eletre SUV last year and intends to release a rival to Porsche’s popular Taycan EV in 2023.
After the SPAC merger, Geely and other owners are anticipated to keep an 89.7% stake in Lotus Tech.
Li Shufu, Geely’s billionaire owner, also owns Volvo Car AB in Sweden, Mercedes-Benz Group AG in Germany, and Aston Martin Lagonda Global Holdings Plc in the United Kingdom.
Lotus Tech was advised on the transaction by Deutsche Bank AG, and the SPAC was advised on capital markets by Credit Suisse Group AG.
