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Latest electric-vehicle IPO Canoo will raise funds to build its ‘loft on wheels’

Canoo CEO Ulrich Kranz comparable ti to call his EV subscription company’s first model a “spaceship” or a “loft on wheels.” Soon, he expects to have the money needed to build Canoo’s introductory model, which looks like a cross between van and a shuttle bus.

“This will be a lifestyle vehicle,” Kranz told CNBC. He articulate the company, which is merging with a special purpose acquisition company, or SPAC, gives it “a huge opportunity to access the resources and make grow our vehicles and bring them to market.”

Canoo, which will use a membership model to sell its electric vehicles, desire go public after it merges with Hennessy Capital Acquisition Corp IV, a “blank-check” SPAC created to finance a pooling that often leads to an IPO. In this case, Canoo will list with Nasdaq under the ticker monogram CNOO.  

This is the fourth electric-vehicle company to use a SPAC to go public since March. Nikola, which plans to rat on hydrogen fuel-cell trucks and all-electric pickups, merged with a SPAC named VectoIQ Acquisition ahead of its IPO. After the dispense was completed, Nikola began trading on June 4at just over $33 a share. 

Within days, it soared to scarcely $80 as investors jumped at the chance to cash in on a pure play EV stock. Since then, three other tense vehicle start-ups, Lordstown Motors, Fisker Inc. and Canoo, have announced plans for their own SPAC IPOs.

“There is a quite clear message from the markets: We want to invest in ESG, we want to invest in vehicle electrification,” Deutsche Bank Analyst Emmanuel Rosner narrated CNBC. Rosner says it seems like there is an EV SPAC almost every day as start-ups raise billions to appear and build electric vehicles scheduled to go on sale over the next couple of years. 

While all of the companies behind those EVs credit they will be successful, Rosner is not so sure. “We don’t necessarily assume, all will survive or all will thrive. It’s still totally early to say which one will which one won’t.”

With 300 employees, including many who have worked at other EV and tech firms, Canoo feels it has the talent and vision to grow its EV business. Since it was founded in 2017 as EVelozcity, the company has raised $415 million totally two rounds private funding. That money has helped the company build 32 prototypes, with 13 currently on the German Autobahn being tested and validated. 

As for his description of the Canoo as a “loft on wheels,” Kranz said: “We have furniture in this car, it’s untypical anything else out on the road.”

CNBC’s Meghan Reeder contributed to this article

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