Lotus Technology (路特斯), a luxury electric carmaker owned by China’s Geely Holding, has agreed to go public by merging with a special purpose acquisition company (SPAC) in a deal that values it at about $5.4 billion, Yicai Global reported on February 1.

Lotus Tech will merge with Nasdaq-listed L Catterton Asia Acquisition, which is affiliated with private equity firm L Catterton, the Wuhan-based automaker said on January 31. All existing shareholders of Lotus Tech, including Geely, Etika, and Nio Capital, will retain their interests and own a total of about 89.7 percent of the new company’s shares.

“We believe the proposed business combination and listing will help position Lotus Tech as a leading global luxury EV company and will enable us to further execute our strategy, accelerate our growth, and importantly, further our mission to steer the industry towards a more sustainable future,” said chief executive officer Feng Qingfeng, who will continue to lead the carmaker.

The proceeds of the deal will be used to innovate products, develop next-generation auto technologies, expand the firm’s global distribution network, and for general corporate purposes, according to Lotus Tech, a unit of UK-based Group Lotus.

Founded in 1948 and acquired by Hangzhou-based Geely in 2017, Lotus has developed luxury EVs by leveraging its research and development facilities in the UK, Germany, and in the cities of Wuhan, Shanghai, and Ningbo in China.

Lotus Tech completed building a factory in Wuhan with Geely last July. The plant, which can produce 150,000 vehicles a year, made its first EV, the all-electric sport utility vehicle Eletre, that same month. The first Eletre is expected to be delivered in China in the first quarter and in the UK and the European Union later this year, according to Yicai Global's report.

“The global EV market is expanding rapidly, with the luxury segment growing at a faster pace than the broader industry,” said Chinta Bhagat, L Catterton Asia Acquisition’s co-CEO.

(Yuan XY)