Arrival, the company creating electric vehicles (“EVs”) with its
game-changing technologies, and CIIG Merger Corp. (NASDAQ: CIIC), a
US publicly-traded special purpose acquisition company, today
announced they have entered a definitive agreement for a business
combination. Upon closing of the transaction, the combined company
will be named Arrival Group and is expected to be listed on NASDAQ
under the new ticker symbol “ARVL”.
Company Highlights
Arrival is challenging the 100 year old automotive production
process, by producing its EVs in low CapEx, low footprint
Microfactories. Its operations utilize Arrival’s in-house
proprietary technologies and advanced cell-based assembly method to
bring down the cost of EVs and accelerate mass adoption
globally.
Arrival’s initial focus is on the commercial vehicle market,
which is undergoing a seismic shift towards electrification in line
with global public policy. Arrival believes that it is well
positioned to capitalize on this market opportunity with its
technology driven approach to a traditionally underserved market.
The result is its best-in-class products with an exceptional user
experience that are priced competitively with fossil-fuel vehicles
and have a substantially lower total cost of ownership (“TCO”) than
both fossil fuel and electric variants.
Arrival's transformative Microfactories can be deployed anywhere
in the world within six months, using existing warehouses close to
areas of demand. These Microfactories are designed to produce any
vehicle from Arrival’s portfolio customized for the cities and
regions they serve. The vehicles are designed specifically for
Microfactory assembly using Arrival’s proprietary in-house
developed components, software and sustainable composite
materials.
Arrival’s vertical integration and new method of production
break the rule of economies of scale and create strong unit
economics for the whole Arrival product portfolio, which Arrival
expects will enable profitability for the business by 2023.
Arrival's strategy to reach industry-transforming flexibility and
scalability is based on the utilization of Microfactories, as
opposed to giant, capital-intensive legacy factories.
“With Arrival’s products our clients are not forced to
compromise between being green and being cost efficient. Our focus
on the whole EV ecosystem, new methods of design and production and
our enabling technologies are the key to driving down the cost of
EVs and accelerating the transition to zero-emission transportation
globally,” said Denis Sverdlov, Founder and CEO of Arrival. “CIIG’s
leadership team has invaluable experience building businesses
globally across a wide range of industries. We are excited to
partner with them as we begin our journey to being a
publicly-listed company and delivering our products to customers
and cities around the world.”
“Arrival's bold, game-changing approach to the production of
electric vehicles made the company the clear winner in our search
for a partner,” said Peter Cuneo, Chairman and CEO of CIIG.
“Operating in stealth mode for five years, Denis and his visionary
team have rewritten the rules of the game for the auto industry.
Arrival’s development of exceptional products using its pioneering
technology and software alongside its groundbreaking new method of
production can create an incredibly low TCO for customers which we
believe stands them apart from everyone else in the electric
vehicle industry. We look excitedly to the future and to our
partnership with Arrival’s talented leadership team.”
Several blue chip companies and investment firms have invested
in Arrival, including Hyundai Motor Company, Kia Motors
Corporation, Winter Capital, United Parcel Service (“UPS”) and
funds and accounts managed by BlackRock. Hyundai and Kia are also
exploring opportunities to co-develop zero-emission vehicles with
Arrival.
In addition, alongside an investment in Arrival in early 2020,
UPS, the global logistics company, announced a commitment to
purchase 10,000 electric vans, and has the additional option to
order more thereafter.
Successful technology entrepreneur Denis Sverdlov will remain as
Arrival’s CEO, with ex-Cruise Head of Strategy, Avinash Rugoobur,
continuing as Arrival’s President. Mike Ableson, former VP of
Global Strategy at GM, is CEO of Arrival Automotive overseeing
global production.
Transaction Overview
The transaction values the combined company at an enterprise
value of US $5.4 billion. Pursuant to the merger and following the
share exchanges, the combined company is expected to receive
approximately US $660 million in gross cash proceeds from a
combination of cash from a US $400 million fully committed stock
PIPE and US $260 million in cash held in CIIG's trust account,
assuming no public shareholders exercise their redemption rights at
closing. Net cash from the transaction will be used to fund growth
of the combined company. The PIPE is anchored by institutional
investors including funds and accounts managed by BlackRock,
Fidelity Management & Research Company LLC, Wellington
Management and BNP Paribas Asset Management Energy Transition Fund.
Current Arrival shareholders will become the majority owners of the
combined company at closing. All existing shareholders and
investors will continue to hold their equity ownership, including,
Hyundai Motor Company, Kia Motors Company, Winter Capital, UPS and
funds and accounts managed by BlackRock.
Both the board of managers and shareholders of Arrival have
unanimously approved the proposed transaction, which is expected to
be completed in the first quarter of 2021. The board of directors
of CIIG has also unanimously approved the proposed transaction. The
proposed transaction will be subject to approval by CIIG
stockholders and satisfaction or the waiver of the closing
conditions identified in the business combination agreement.
Additional information about the proposed transaction, including
a copy of the business combination agreement will be filed by CIIG
in a Current Report on Form 8-K to be filed by CIIG with the
Securities and Exchange Commission and available at
www.sec.gov.
AdvisorsCowen served as lead placement agent
and UBS Investment Bank served as placement agent on the PIPE.
Cowen is serving as lead financial advisor and J.P. Morgan is
serving as financial advisor to Arrival. UBS Investment Bank and
Barclays are serving as financial and capital markets advisors to
CIIG. Greenberg Traurig, LLP is serving as legal advisor to
Arrival. Akin Gump Strauss Hauer & Feld LLP is serving as legal
advisor to CIIG.
Investor Conference Call InformationArrival and
CIIG will host a joint investor call to discuss the proposed
transaction and review an investor presentation today, November 18,
2020.
The investor presentation is furnished as an exhibit in a
Current Report on Form 8-K filed by CIIG prior to the call,
available on the SEC website at www.sec.gov.
To access the audio replay, go to Arrival’s investor website, at
https://arrival.com/investors through November 30, 2020.
About ArrivalArrival is reinventing the
automotive industry with its entirely new approach to the design
and assembly of electric vehicles. Low CapEx, rapidly scalable
Microfactories combined with proprietary in-house developed
components, materials and software, enable the production of best
in class vehicles competitively priced to fossil fuel variants and
with a substantially lower Total Cost of Ownership. This
transformative approach provides cities globally with the solutions
they need to create sustainable urban environments and exceptional
experiences for their citizens. Arrival was founded in 2015 and is
headquartered in the United Kingdom, with over 1,300 global
employees located in offices across the United States, Germany,
Netherlands, Israel, Russia, and Luxembourg. The company is
deploying its first two Microfactories in South Carolina, US and
Bicester, UK in 2021.
About CIIGCIIG Merger Corp. (NASDAQ: CIIC) is a
Delaware special purpose acquisition company founded by Peter
Cuneo, Gavin Cuneo and Michael Minnick for the purpose of effecting
a merger, capital stock exchange, asset acquisition, stock
purchase, reorganization or similar business combination with one
or more businesses. CIIG’s units, Class A common stock and warrants
trade on the NASDAQ under the ticker symbols "CIICU," "CIIC," and
"CIICW" respectively.
Additional Information and Where to Find
It
In connection with the proposed transaction, Arrival Group, a
subsidiary of Arrival that will become the holding company of CIIG
and be renamed Arrival as of the closing of the proposed
transaction, is expected to file a registration statement on Form
F-4 (the “Form F-4”) with the U.S. Securities and Exchange
Commission (the “SEC”) that will include a proxy statement of CIIG
that will also constitute a prospectus of Arrival Group. CIIG and
Arrival Group urge investors, stockholders and other interested
persons to read, when available, the Form F-4, including the
preliminary proxy statement/prospectus and amendments thereto and
the definitive proxy statement/prospectus and documents
incorporated by reference therein, as well as other documents filed
with the SEC in connection with the proposed transaction, as these
materials will contain important information about Arrival Group,
Arrival, CIIG and the proposed transaction. Such persons can also
read CIIG’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2019, for a description of the security holdings of
CIIG’s officers and directors and their respective interests as
security holders in the consummation of the proposed transaction.
When available, the definitive proxy statement/prospectus will be
mailed to CIIG’s and Arrival’s stockholders. Stockholders will also
be able to obtain copies of such documents, without charge, once
available, at the SEC’s website at www.sec.gov, or by directing a
request to: CIIG Merger Corp., 40 West 57th Street, 29th Floor, New
York, NY 10019 or Arrival S.à r.l., 1, rue Peternelchen, L-2370
Howald, Luxembourg.
Participants in
Solicitation
CIIG, Arrival Group and Arrival and their respective directors,
executive officers and other members of their management and
employees, under SEC rules, may be deemed to be participants in the
solicitation of proxies of CIIG’s stockholders in connection with
the proposed transaction. Investors and security holders may obtain
more detailed information regarding the names, affiliations and
interests of CIIG’s directors and executive officers in CIIG’s
Annual Report on Form 10-K for the fiscal year ended December 31,
2019, which was filed with the SEC on March 27, 2020. Information
regarding the persons who may, under SEC rules, be deemed
participants in the solicitation of proxies of CIIG’s stockholders
in connection with the proposed transaction will be set forth in
the proxy statement/prospectus for the proposed transaction when
available. Information concerning the interests of CIIG’s
participants in the solicitation, which may, in some cases, be
different than those of CIIG’s equity holders generally, will be
set forth in the proxy statement/prospectus relating to the
proposed transaction when it becomes available.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of the federal securities laws, including
statements regarding the benefits of the proposed transaction, the
anticipated timing of the proposed transaction, the products
offered by Arrival and the markets in which it operates, and
Arrival Group’s projected future results. These forward-looking
statements generally are identified by the words “believe,”
“project,” “expect,” “anticipate,” “estimate,” “intend,”
“strategy,” “future,” “opportunity,” “plan,” “may,” “should,”
“will,” “would,” “will be,” “will continue,” “will likely result,”
and similar expressions. Such statements are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995 and are based on management’s belief or interpretation
of information currently available. Forward-looking statements are
predictions, projections and other statements about future events
that are based on current expectations and assumptions and, as a
result, are subject to risks and uncertainties. Many factors could
cause actual future events to differ materially from the
forward-looking statements in this document, including, but not
limited to: (i) the risk that the transaction may not be completed
in a timely manner or at all, which may adversely affect the price
of CIIG’s securities, (ii) the risk that the transaction may not be
completed by CIIG’s business combination deadline and the potential
failure to obtain an extension of the business combination deadline
if sought by CIIG, (iii) the failure to satisfy the conditions to
the consummation of the transaction, including the adoption of the
business combination agreement by the stockholders of CIIG and
Arrival, the satisfaction of the minimum trust account amount
following redemptions by CIIG’s public stockholders and the receipt
of certain governmental and regulatory approvals, (iv) the lack of
a third party valuation in determining whether or not to pursue the
proposed transaction, (v) the occurrence of any event, change or
other circumstance that could give rise to the termination of the
business combination agreement, (vi) the impact of COVID-19 on
Arrival’s business and/or the ability of the parties to complete
the proposed transaction; (vii) the effect of the announcement or
pendency of the transaction on Arrival’s business relationships,
performance, and business generally, (viii) risks that the proposed
transaction disrupts current plans and operations of Arrival and
potential difficulties in Arrival employee retention as a result of
the proposed transaction, (ix) the outcome of any legal proceedings
that may be instituted against Arrival Group, Arrival or CIIG
related to the business combination agreement or the proposed
transaction, (x) the ability to maintain the listing of CIIG’s
securities on the NASDAQ Stock Market, (xi) the price of CIIG’s and
the post-combination company’s securities may be volatile due to a
variety of factors, including changes in the competitive and highly
regulated industries in which Arrival operates, variations in
performance across competitors, changes in laws and regulations
affecting Arrival business and changes in the combined capital
structure, (xii) the ability to implement business plans,
forecasts, and other expectations after the completion of the
proposed transaction, and identify and realize additional
opportunities, (xiii) the risk of downturns and the possibility of
rapid change in the highly competitive industry in which Arrival
operates, (xiv) the risk that Arrival and its current and future
collaborators are unable to successfully develop and commercialize
Arrival’s products or services, or experience significant delays in
doing so, (xv) the risk that the post-combination company may never
achieve or sustain profitability; (xvi) the risk that the
post-combination company will need to raise additional capital to
execute its business plan, which may not be available on acceptable
terms or at all; (xvii) the risk that the post-combination company
experiences difficulties in managing its growth and expanding
operations, (xviii) the risk that third-parties suppliers and
manufacturers are not able to fully and timely meet their
obligations; (xix) the risk that the utilization of Microfactories
will not provide the expected benefits due to, among other things,
the inability to locate appropriate buildings to use as
Microfactories, Microfactories needing a larger than anticipated
factory footprint, and the inability of Arrival to deploy
Microfactories in the anticipated time frame; (xx) the risk that
the orders that have been placed for vehicles, including the order
from UPS, are cancelled or modified; (xxi) the risk of product
liability or regulatory lawsuits or proceedings relating to
Arrival’s products and services; (xxii) the risk that Arrival is
unable to secure or protect its intellectual property; and (xxiii)
the risk that the post-combination company’s securities will not be
approved for listing on the NASDAQ Stock Market or if approved,
maintain the listing. The foregoing list of factors is not
exhaustive. You should carefully consider the foregoing factors and
the other risks and uncertainties described in the “Risk Factors”
section of CIIG’s Annual Report on Form 10-K, Quarterly Reports on
Form 10-Q, the registration statement on Form F-4 and proxy
statement/prospectus discussed above and other documents filed by
CIIG from time to time with the SEC. These filings identify and
address other important risks and uncertainties that could cause
actual events and results to differ materially from those contained
in the forward-looking statements. Forward-looking statements speak
only as of the date they are made. Readers are cautioned not to put
undue reliance on forward-looking statements, and Arrival Group,
Arrival and CIIG assume no obligation and do not intend to update
or revise these forward-looking statements, whether as a result of
new information, future events, or otherwise. Neither Arrival
Group, Arrival nor CIIG gives any assurance that either Arrival
Group, Arrival or CIIG will achieve its expectations.
No Offer or Solicitation
This press release is not a proxy statement or solicitation of a
proxy, consent or authorization with respect to any securities or
in respect of the proposed transaction and shall not constitute an
offer to sell or a solicitation of an offer to buy the securities
of CIIG, Arrival or Arrival Group, nor shall there be any sale of
any such securities in any state or jurisdiction in which such
offer, solicitation, or sale would be unlawful prior to
registration or qualification under the securities laws of such
state or jurisdiction. No offer of securities shall be made except
by means of a prospectus meeting the requirements of Section 10 of
the Securities Act, or exemptions therefrom.
PRIIPs / Prospectus Regulation /IMPORTANT – EEA AND UK
RETAIL INVESTORS – The ordinary shares to be issued by
Arrival Group in the proposed transaction (the “Ordinary Shares”)
are not intended to be offered, sold or otherwise made available to
and should not be offered, sold or otherwise made available to any
retail investor in the EEA or in the UK. For these purposes, a
retail investor means a person who is one (or more) of: (i) a
retail client as defined in point (11) of Article 4(1) of MiFID II;
or (ii) a customer within the meaning of Directive (EU) 2016/97,
where that customer would not qualify as a professional client as
defined in point (10) of Article 4(1) of MiFID II; or (iii) not a
qualified investor as defined in Regulation (EU) 2017/1129 of the
European Parliament and of the Council of 14 June 2017(this
Regulation together with any implementing measures in any member
state, the “Prospectus Regulation”). Consequently, no offer of
securities to which this announcement relates, is made to any
person in any Member State of the EEA which applies the Prospectus
Regulation who are not qualified investors for the purposes of the
Prospectus Regulation, is made in the EEA and no key information
document required by Regulation (EU) No. 1286/2014 (as amended the
“PRIIPs Regulation”) for offering or selling the Ordinary Shares or
otherwise making them available to retail investors in the EEA or
in the United Kingdom will be prepared and therefore offering or
selling the Ordinary Shares or otherwise making them available to
any retail investor in the EEA or in the United Kingdom may be
unlawful under the PRIIPs Regulation.
Media Contacts
For ArrivalMedia Victoria
Tomlinsonpr@arrival.com
Investors ir@arrival.com
For CIIGMedia and InvestorsGavin
Cuneoinfo@ciigcorp.com
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