Californian battery startup Romeo Power is now going public on the US stock exchange via a merger with the investment firm RMG Acquisition. The goal is to expand the production and development of commercial vehicle batteries.
Romeo Power has raised $384 million with the merger and related business transactions. They will invest the funds in capacity expansion and R&D to further develop battery system technologies for commercial vehicles.
Romeo Power was founded in 2016 by former engineers from SpaceX, Tesla, Apple, Amazon and Samsung. The company recently completed the construction of a production facility with a capacity of 7 GWh in Los Angeles.
Romeo Power is the latest electric transport industry player to go public on the US stock exchange through a merger with an investment company. ChargePoint and Nikola Motor among others have utilized this strategy, only yesterday electric car startup Faraday Futures announced they were also targeting this strategy, also known as SPAC.
RMG Acquisition is traded on the New York Stock Exchange under the abbreviation RMG. The future abbreviation of the merged company will be RMO. The Californian company says that this move values them at $1.33 billion and brings in $384 million. Upon completion of the merger, two managers from RMG Acquisition will join the Romeo Power board of directors.
Last year, US supplier BorgWarner invested 50 million dollars in Romeo Power through a joint venture. BorgWarner holds a majority of 60 per cent in the JV, in addition to a direct holding of 20 per cent in Romeo Power Technology. BorgWarner intends to close the supply gap between manufacturers of battery cells and buyers of hybrid and electric vehicles through integration with Romeo Power. The joint venture and investment should allow Romeo to leverage BorgWarner’s customer base, supply chain and manufacturing expertise.
Romeo Power has also entered into another cooperation agreement with The Heritage Group, a provider of environmental and recycling services. The Heritage Group is one of the early investors in the Californian startup and is now aiming to develop a joint recycling facility for batteries from Romeo Power’s range as part of the intensified cooperation. The Heritage Group is planning a project to convert more than 500 diesel trucks to electric trucks by 2025 using batteries from Romeo Power.
Lionel Selwood Jr., Chief Executive Officer of Romeo Power, surmised: “Several of the world’s largest logistics companies have announced their commitments to electric fleets, and just about all major OEMs have announced electric vehicle programs,” continued Lionel Selwood Jr. “The team of experts at Romeo Power, which has experience across the electric vehicle, aerospace, and broader technology industries, is excited about the opportunity to tap into this quickly growing market as we help enable the electrification of the commercial vehicle fleet globally for decades to come.”
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