‘Blank check’ company DiamondPeak soars 29% after inking deal to acquire electric vehicle maker Lordstown Motors (DPHC)

Lordstown Motors

  • Lordstown Motors is going public via a reverse-merger with a SPAC, also known as a “blank check” company.
  • DiamondPeak Holdings will merge with Lordstown Motors in a deal that values the Ohio-based electric vehicle maker at $1.6 billion. 
  • The transaction will generate up to $675 million in financing for Lordstown Motors, which will be used to fund the production of the Endurance electric pickup truck.
  • The Lordstown deal extends the hot trend of going public via a SPAC in 2020. Electric vehicle makers Nikola Corp. and Fisker Inc. saw their stocks skyrocket after going public via reverse mergers with SPACs earlier this year.
  • Shares of DiamondPeak Holdings surged as much as 29% on Monday after announcing the merger.
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Ohio-based Lordstown Motors is going public via a reverse-merger with “blank check” company DiamondPeak Holdings in a deal that values the electric vehicle maker at $1.6 billion.

The deal will raise up to $675 million in financing for Lordstown Motors, which will be used to fund the production of its Endurance electric pickup truck.

The deal extends a hot streak for SPACs in 2020, which brought public other electric vehicle makers like Nikola Corp. and Fisker Inc.

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Lordstown Motors was originally owned by Workhorse, but it was eventually spun off as a separate company. Workhorse retains a 10% stake in Lordstown Motors. Workhorse jumped as much as 11% in Monday pre-market trades following the announcement.

Lordstown’s Endurance pickup truck will directly compete with electric pickup trucks from EV makers Tesla, Nikola Corp., Fisker Inc., and Rivian.

Lordstown expects the Endurance to enter production in the second half of 2021. 

General Motors invested $75 million in the deal, as the company looks to diversify its exposure to electric vehicle manufacturers following its investment in Rivian. Other investors in the deal include Fidelity and BlackRock.

DiamondPeak soared as much as 29% to $13.20 in Monday pre-market trades after the merger was announced. The transaction is expected to close in the fourth quarter.

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