An electric vehicle battery supplier backed by Microsoft co-founder Bill Gates and Volkswagen is the newest automotive company to announce plans to go public through a special purpose acquisition company.
QuantumScape, a developer of what are known as solid-state batteries, said Thursday it has entered into a definitive agreement to merge with blank check SPAC Kensington Capital Acquisition Corp. to become a publicly traded company in the fourth quarter.
The implied value of the combined company, which will list on the New York Stock Exchange under the ticker QS, is $3.3 billion. QuantumScape is expected to receive more than $1 billion in cash and funding commitments, led by Volkswagen and Qatar’s sovereign wealth fund, as part of the transaction.
In 2018, Volkswagen and QuantumScape announced the formation of a joint manufacturing venture to prepare for the mass production of solid-state batteries.
Many believe the batteries are the next best power source for future electric vehicles. Compared with today’s lithium-ion batteries, solid-state batteries charge quicker and have a greater energy density, meaning vehicles can go farther with the same size battery pack. However, the batteries are extremely costly to produce.
Justin Mirro, chairman and CEO of Kensington, said it was the potential for the technology as well as the company’s progress in developing the batteries that attracted him to the company.
“We’ve done a lot of work on the technology,” he said. “This is really a revolutionary step in terms of technology.”
Mirro, who will be a board member of the combined company, said his team evaluated hundreds of companies before determining that QuantumScape was “by far” the best to create long-term shareholder value.
Other investors in QuantumScape include German auto supplier Continental, Chinese automaker SAIC Motor and several venture capitalist firms, according to the company’s website.
Originally published on CNBC