Electric vehicle technology specialist Proterra announced Jan. 12 that it would go public via a $1.6 billion merger with blank-check firm ArcLight Clean Transition Corp.
Proterra, which produces batteries and charging systems for commercial electric vehicles, said in a statement the deal would take its technologies to “new levels” of growth. The company is based in Burlingame, Calif., with manufacturing facilities on the West Coast and in South Carolina. It also has an R&D space in Silicon Valley.
Latham & Watkins advised Proterra, with Houston partner Ryan Maierson leading along with Chicago partners Mark Gerstein and Max Schleusener, with Chicago associates Megan Staub, Lucy Chauvin, Jonathan Sarna, KC Sands and Ryan Hudson. California firm Fenwick & West also provided legal counsel, and BofA Securities acted as lead financial advisor.
Kirkland & Ellis counseled ArcLight with a team led by transactional partners Doug Bacon of Houston, Kristin Mendoza of New York and Alex Rose of Dallas. Capital markets partners Jim Rowe of Chicago and Brooks Antweil of Houston were also on the team.
Barclays acted as M&A advisor to Arclight, with Citigroup acting as M&A and Capital Markets advisor. Meanwhile, Morgan Stanley and Barclays are acting as lead placement agents, and BofA Securities was joint placement agent for ArcLight.
Proceeds from the transaction include $648 million in cash at closing, with about $278 million of that held in ArcLight Clean Transition’s trust account from its initial public offering in September 2020.
The deal will also be funded by a $415 million private investment in public equity (PIPE) financing at $10per share from “key investors”, which include Daimler Trucks, Franklin Templeton, and Fidelity Management & Research. The key investors also include funds and accounts managed by private equity giant BlackRock, Neuberger Berman Funds and affiliates of ArcLight. Proterra’s existing shareholders have agreed to convert 100% of their ownership stakes into the new company, and are expected to own more than 60% of the combined company at close.
Proterra recently announced the opening of a new battery production line co-located in its electric transit bus manufacturing facility in Los Angeles County.
“This transaction enables Proterra to take the next step towards our mission of advancing EV technology to deliver the world’s best performing commercial vehicles,” Proterra chief executive Jack Allen said.
“In addition, it introduces a partner in ArcLight that has a shared focus on sustainability and renewable energy. We look forward to working closely with the ArcLight team as we create value for our shareholders and customers, scale our business to new levels and benefit the world around us.”
Allen will continue to lead the company following the deal’s close, and ArcLight Clean Transition Corp. chief executive Jake Erhard will join Proterra’s board.
ArcLight Clean Transition is based in Boston and is sponsored by PE firm ArcLight Capital partners. The special purpose acquisition firm made its public debut on the Nasdaq exchange in September, with a view to seek assets focused on sustainable energy and the energy transition.