Henrik Fisker intends to make a big splash in his third act in the auto industry, arranging new financing and a reverse merger that will get shares of his Los Angeles-based electric vehicle startup trading on the New York Stock Exchange. And if that weren’t enough, the famed car designer says Fisker Inc. will come to market with a new “asset-light” business model relies on partnerships, shared manufacturing and leased products.
Spartan Energy Acquisition Corp., a special purpose acquisition company linked to Apollo Global Management
“We are fully funded all the way to production,” he tells Forbes. “We have a very unique business. We’re not a normal car company, we’re a digital car company. We are really working on a completely new way of getting hardware into production.”
In contrast to Elon Musk’s Tesla
The company unveiled its battery-powered Ocean SUV in January at CES in Las Vegas, a handsome crossover made of recycled metals and plastic with a base price of just $37,499 and that can be leased for as little as $379 a month. In fact, Fisker’s plan is essentially a lease-only business model that lets customers keep a vehicle for years or return it at any time. It aims to source motors, batteries and other components from technical partnerships with automakers and will outsource production from existing auto plants. Another unique twist: Aside from Henrik, all of five of Fisker’s other designers are women, he says.
While electric vehicle sales have grown slowly for most automakers other than Tesla, the segment is poised to expand as markets including the European Union, China and U.S. states that follow California’s strict zero-emission vehicle regulations seek to curb carbon emissions by getting more gasoline-powered cars and trucks off the road. General Motors
After achieving acclaim for his design work at Aston Martin and BMW, Henrik Fisker’s first startup attempt, Fisker Automotive, failed despite having a stunning plug-in hybrid concept, early VC funding and a $528 million low-cost federal loan. In the company’s rush to get vehicles into production, it ran into a series of setbacks, including faulty battery packs, technical glitches and a hurricane that trashed a shipment of Fisker Automotive’s $103,000 Karma luxury cars. Those and other problems sent the company into a tailspin and bankruptcy in 2013. (Its assets were purchased by the Wangxiang Group, a Chinese auto-parts maker, and the company was relaunched as Karma Automotive a few years ago, selling a plug-in model based on Henrik Fisker’s original design.)
“Henrik has an unparalleled and world-renowned design track record and is supported by an expert management team with storied careers in the automotive industry,” Geoffrey Strong, chairman and chief executive officer of Spartan and senior partner, co-head of infrastructure and natural resources at Apollo, said in a statement. “The right team, combined with deep financial resources provided by this transaction, further position the company to succeed in a rapidly growing industry.”
The combined equity value of Fisker and Spartan of $2.9 billion is based on a $10.00 per share PIPE price (private investment in public equity) that assumes most current Spartan investors don’t redeem their shares. Listings via reverse mergers are typically cheaper than traditional IPOs and have been used this year by hydrogen truckmaker Nikola Motor and laser lidar pioneer Velodyne.