Electric vehicle charging network ChargePoint officially announced Thursday that it will go public through a reverse merger with Switchback Energy Acquisition Corp (NYSE: SBE). The deal would value Campbell, California-based ChargePoint at more than $2 billion.
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The transaction includes $225 million in upsized private investment in public equity (PIPE) at $10 per share, according to the company in a written statement. In early afternoon trading, Switchback was trading at $12.91 per share.
Becoming a public company gives ChargePoint access to a new source of permanent capital to fund growth in the years ahead, said Darryll Harrison Jr., senior director of global communications, via email.
Approximately $493 million in net proceeds “are expected to fund expansion of the commercial fleet and residential business in North America and Europe, accelerate R&D for hardware, software and services and continue to scale our go to market strategy,” he added.
Last week, we shared a Reuters report that said Switchback, based in Dallas, was created in 2019 as a special purpose acquisition company, aka SPAC, and raised $300 million in its IPO.
In August, we reported on ChargePoint’s $127 million Series H extension round of funding that gave the company a total of $660 million in funds raised since its inception in 2007, according to Crunchbase data.
The last funding round gave the company “a lot of optionality,” and it had stated publicly that becoming a public company was something ChargePoint would do when it was ready, Harrison said.
“The timing worked out because, today, we’re ready to be public,” he added. “ChargePoint is a well-established company with a 13-year history of success, saw a massive opportunity for EV charging early on, and built a robust and scalable platform to address it. We now have 4,000 customers, a 73 percent market share (network level 2, North America) and a strong leadership team in place to enable the movement of all people and goods on electricity.”
ChargePoint President and CEO Pasquale Romano, and the existing leadership team, will lead the combined company.
The company is the latest to join a long line of startups choosing to go public via SPACs. Last week, we reported that 2020 seems to be the “year of the SPAC.”
“We were approached by a number of interested parties who were aware of ChargePoint,” Harrison said. “We decided to pursue a SPAC with Switchback Energy Acquisitions Corp. because they share our vision and approach and are a good fit.”
Illustration: Li-Anne Dias