VectoIQ Acquisition (NASDAQ:VTIQ) said on Wednesday that its much-anticipated merger with electric heavy-truck maker Nikola Motor has closed, a day after its shareholders voted to approve the transaction.
The deal provides Nikola with more than $700 million in new cash, much of it from a related "PIPE" (private investment in public equity) transaction where investors, including Fidelity Investments and hedge-fund manager P. Schoenfeld Asset Management, bought shares of the combined company at a discounted price.
Nikola, founded in 2014 by Trevor Milton, has developed a series of all-electric Class 8 (tractor-trailer) trucks that have attracted considerable interest from the trucking industry as well as investors. One reason for the interest: Nikola's trucks will be offered with choice of a proprietary high-energy-density battery or a hydrogen fuel cell. The company has over 14,000 pre-order reservations for the trucks, representing more than $10 billion in potential sales.
Nikola expects to begin construction of a factory in Arizona soon and to have the battery-powered trucks in production by the end of next year. The fuel-cell trucks will follow about two years later after Nikola builds out a network of hydrogen refueling stations.
Milton, who has led Nikola since its founding, will remain as the combined company's executive chairman. Nikola president Mark Russell will succeed Milton as CEO, and VectoIQ CEO Stephen Girsky -- formerly vice-chairman of General Motors (NYSE:GM) -- will join its board of directors, the companies said.
The combined company will operate under the name "Nikola Corporation." Its shares, which more than doubled in value in May as investors rushed to secure positions ahead of the merger, will begin trading under the ticker symbol "NKLA" on Thursday.