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After SPAC Merger, EV Company Takes First Day Wild Ride

Tech
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Image Credit: Ivan Radic (Flickr)

EV Motorcycle Division Merged with SPAC and Goes Full Throttle at Market Open

Harley-Davidson’s EV electric-motorcycle division was just merged with the SPAC (special purpose acquisition corporation) AEA-Bridges (IMPX). The newly merged company, retaining the name LiveWire (LVWR) accelerated from the opening bell on day one. It quickly rose 23.9% in the first half hour of trading. While the company then gravitated back toward its opening price, the performance for these SPAC investors this year far exceeds that of the major indices.

The relative success of this reverse merger demonstrates that so-called blank check companies can still provide value to investors and can still strike deals with a quality target.

The current decline in valuations of companies and assets through 2022 may even serve to make for a target-rich environment for SPACS still trying to find an exceptional deal for their SPAC investors.

LiveWire, which will continue operating under this name and trading with ticker $LVWR, had been a subsidiary of Harley-Davidson Inc. (HOG). The iconic motorcycle maker and merchandise licenser retained a controlling (75%) interest in the e-motorcycle operation after the deal closed.

The stock had been halted after hitting NYSE circuit breakers on its first trading day (September 27) because of volatility. The morning range has been down as much as 4.2% and up as much as 23.9% in within the first half hour after the open. The stock, which began as an IPO pre-merger at $10, opened the year at $9.99 and is now trading about 10% below. The overall market, as measured by the S&P 500, is down 23.76% on the year.

Livewire likes it to be known that they are the “first and only” electric-vehicle motorcycle company in the U.S. to be listed on the NYSE. They raised approximately $334 million in proceeds from the acquisition.

Harley-Davidson’s stock ran up 1.5% in morning trading. It has climbed 14.8% over the past three months, during that period, the S&P 500 index has lost 5.2%.

More About LiveWire

LiveWire describes itself as the future in the making for the pursuit of urban adventure and beyond.

It draws on its long history, having begun ten years ago as a disruptor from the shops of Harley-Davidson. This gives it a giant head start in the EV sector. LiveWire’s ambition is to be the most desirable electric motorcycle brand in the world. With a dedicated focus on EV, LiveWire plans to develop the technology of the future and to invest in the capabilities needed to lead the transformation of motorcycling.

Harley-Davidson

Harley Davidson intends to build on it’s legend of leading the industry through innovation, evolution and emotion. It imparted on LiveWire the understanding that the product represents more than its utility. For its customers, Harley’s represent the timeless pursuit of adventure and freedom for the soul. The company’s focus is to maintain its place as the most desirable motorcycle brand in the world. The 75% ownership in Livewire, plus the cash infusion, should serve to allow its investment in the EV sector to take an even larger role in electrified transportation.  

Paul Hoffman

Managing Editor, Channelchek

Sources

https://investor.harley-davidson.com/news/news-details/2022/Harley-Davidson-LiveWire-and-AEA-Bridges-Impact-Corp-Announce-Closing-of-Business-Combination/default.aspx

https://www.marketwatch.com/story/livewire-stock-to-surge-on-nyse-debut-11664284420?siteid=yhoof2

www.koyfin.com

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