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Fast chargers are expected to be available in supermarkets, retail stores, entertainment centers and other high traffic locations. Drivers can conveniently charge their vehicles at an EVgo station while carrying out their tasks.
Courtesy of GM
The famous phrase from the classic baseball film Field of Dreams is: If you built it, they will come. In the case of the electric vehicle industry, the line should be: They are coming, so you better build.
Automakers, new and old, are planning to launch dozens of fully electric vehicles in the coming years, capitalizing on the incredible success of
Tesla
(ticker: TSLA). This will mean more demand for public EV charging infrastructure by drivers who want to recharge while away from home.
For EV adoption to continue to grow at a rapid pace, the charging infrastructure will also need to keep pace with vehicle sales. Seeing more plugs around town could convince at-risk buyers to switch from internal combustion to battery power with less sacrifice.
EVgo is a company that can help solve the chicken egg dilemma. The California-based startup is merging with a special purpose acquisition company, or SPAC, called
Acquisition of the real impact of the climate change crisis
(CLII) or CRIS. Announced on Friday, the transaction will make EVgo public, giving investors a chance to participate in the tour. It will also provide EVgo with about $ 575 million in new capital to help accelerate the construction of its fast charging network across the country. The company currently claims to have more than 800 shippers in 34 states and 220,000 customers.
The difference between slow and fast charging stations – which can also be called level 2 and level 3 charging stations – comes down to the amount of electricity that the charger can safely pump into the EV batteries. This rate depends on the car’s hardware, but it also depends on the EV charging infrastructure.
Non-EV investors who run the stock market may have heard of EVgo before Friday.
General Motors
(GM) partnered with the company last summer, announcing plans to add more than 2,700 fast charging stations in the next five years. GM wants to sell a lot more EVs in the coming years, and having the infrastructure for new battery-powered cars will help, the thinking goes.
EVgo chargers work for cars from any manufacturer and are located in supermarket parking lots, outside office buildings and on city streets. The company targets daily passengers and commercial operators. EVgo has partnered with
Uber Technologies
(UBER) and
Lyft
(LYFT) for your hitchhiking drivers to charge your EVs.
“The EV market is expected to grow 100 times between now and 2040,” said Cathy Zoi, EVgo CEO Barron’s. “So the charging needs of these vehicles, and especially fast charging, are going to grow phenomenally … More different types of people will buy EVs that don’t have charging at home, more commercial fleets will have EVs and the cars themselves are getting bigger and heavier, so they need more juice. “
There are other EV charging companies, including
Blink Charging
(BLNK) and
Beam Global
(BEEM). Blink’s market capitalization is around $ 1.9 billion. Beam is smaller, with a market value of approximately $ 450 million.
Both are smaller than EVgo for now. Zoi did not address any competitors directly, but expressed confidence in her company’s technology and service capabilities, which include call centers to manage customer issues, software to control charging stations, as well as advanced hardware designed to minimize time. needed to charge an EV.
The CRIS-EVgo business values the combined stock at around $ 2.6 billion. The proceeds include the $ 230 million from the SPAC fund focused on climate change, plus a private investment of $ 400 million in public shares, or PIPE. PIPE sponsors include a list of major institutional investors: funds managed by Pimco,
Black stone,
Wellington Management, Neuberger Berman and Van Eck. They are all reaching $ 10 per share, against $ 13.34 for closing CRIS shares on Thursday.
CRIS, which went public on September 30, and several other SPACs for renewable energy, climate change and prefabricated electric vehicles have been trading well above their confidence figures in recent months.
QuantumScape
(QS),
Hyliion
(HYLN), and
Nikola
(NKLA) everyone saw their stock prices multiply after the SPAC mergers in 2020, and investors wanted to get into the next hot deal.
EVgo’s current shareholders – which include management and an investment company focused on energy LS Power – will own about 74% of the merged entity. Pending shareholder approval, CRIS shares will be converted into EVgo shares and will change its ticker to “EVGO”.
(
Canoe,
an EV manufacturer that merged with another SPAC, now has a “GOEV.” stock symbol)
“It is almost a certainty to me that this addressable market will be realized,” says David Crane, CEO of CRIS who served as CEO of NRG Energy (NRG) from 2003 to 2015. “It is not as if this sector needed any major breakthrough that it may or may not happen. “
Car manufacturers have committed hundreds of billions of dollars to their EV programs, and governments are committed to the transition of the carbon-emitting vehicle industry that uses carrots and sticks. The Biden administration talked about installing half a million charging stations in the USA. And consumers like to drive electric vehicles.
Investors are also convinced that EVs are the future of personal transport. Various EV actions Barron’s ranges have risen about 500% on average in the past year. Tesla is now the most valuable car manufacturer in the world by a wide margin. And EV manufacturers, taken together, are worth almost the same amount as all traditional automakers, despite delivering a fraction of the vehicles.
Write to Al Root at [email protected] and Nicholas Jasinski at [email protected]