EV maker Lotus Tech closes up modestly in Nasdaq debut after SPAC merger (updated)

Lotus Technology

23/02/2024 23:19

(Added background of EV industry, and a quote)
    By Echo Wang and Lance Tupper
       NEW YORK, Feb 23 (Reuters) - Shares of Lotus Technology
 LOT.O  closed up 2% in their Nasdaq debut on Friday, recouping
earlier losses, after the luxury electric car maker completed
its merger with a blank-check acquisition company backed by
private equity firm L Catterton.
    The American Depositary Shares, which began trading with the
new ticker "LOT", ended at $13.80 after falling as low as
$10.12. About 190,000 shares traded. The special purpose
acquisition company (SPAC) closed at $13.51 on Thursday.
    Lotus Technology was valued at about $7 billion in the deal
with L Catterton Asia Acquisition Corp  LCAA.O  (LCAA), the SPAC
backed by L Catterton. It is part of British sports car maker
Lotus Group which in turn is owned jointly by Chinese automaker
Geely  GEELY.UL  and Malaysia's Etika Automotive. 
    The listing came at a time when EV makers are facing
scrutiny in capital markets. Rivian Automotive  RIVN.O  and
Lucid Group  LCID.O  tumbled on Thursday after their earning
reports pointed to the impact of slowing EV demand on their
ramp-up plans.
    Lotus Technology is headquartered in the central Chinese
city of Wuhan and produces cars through a partnership with
Geely. It designs, develops and sells luxury lifestyle EVs under
the British brand Lotus founded in 1948.
    "At this point in time, being able to access capital market
through the IPO... is an acceleration for Lotus to expand
globally," said Qingfeng Feng, chief executive officer of Lotus
Tech. 
    Similar to other SPAC mergers, over 90% of LCAA shareholders
redeemed their shares, leaving the trust's account with roughly
$11 million. Typically, a stock is prone to volatility if only a
small amount of shares are publicly available.
    Lotus Technology has launched two EV models, including its
first fully electric sports utility vehicle, Eletre. The model
started delivery in China in 2023 and followed in the UK and the
European Union, the company said. It is expecting to deliver
cars in the U.S. later this year.  
    The company secured $880 million in financing ahead of its
merger with LCAA.
    "We saw what these guys were trying to do to it, essentially
building a global luxury business, which is very different from
just a typical EV company. And so we thought that our
partnership would be able to help them do that well," said
Chinta Bhagat, Co-Chief Executive Officer of LCAA.

 (Reporting by Echo Wang and Lance Tupper in New York; Editing
by Cynthia Osterman and Sandra Maler)
 ((E.Wang@thomsonreuters.com; +13322191785; Reuters Messaging:
@deer_echo_))