Nuvve Plans To Go Public Through SPAC Newborn Acquisition Corp.
On Thursday, Nuvve announced a deal that it will merge with Nasdaq-listed SPAC Newborn Acquisition Corp. to form Nuvve Holdings. It is the latest example of an EV-related company seeking public financing.
Newborn now holds about $57.5 million in cash, and the companies have commitments from institutional investors to put about $18 million into the combined companies. Nuvve expects to achieve a pro forma equity value of $202 million, or about $132 million in enterprise value, with roughly $70 million in cash to fund growth.
Electric vehicles made up only 2.6% of global automotive and heavy-duty vehicle sales last year. But government transportation electrification mandates and the increasing cost parity of EVs against internal combustion engine vehicles will drive that share to nearly 14 percent by 2030, according to Wood Mackenzie.
Europe is a teaming with managed EV charging, with multiple vendors like Shell-owned NewMotion, Engie-owned EV-Box and BP-owned Chargemaster. Companies like Nuvve and Tibber are launching V2G projects in Scandinavia and seeking opportunities in Germany, France, the U.K. and other markets.
U.S., utilities are investing billions of dollars into EV charging infrastructure, state and local governments are directing incentives to EV charging, and companies including Tesla, EVgo, Chargepoint and Electrify America (the company set up to disburse about $2 billion in funds from the Volkswagen Dieselgate settlement) are busily expanding public charging networks.
The company’s technology, developed at the University of Delaware by Professor Willett Kempton, launched in 2007 in a pilot project tapping EV batteries as frequency regulation for mid-Atlantic grid operator PJM.
Denmark was its first European target, with pilot projects leading to a commercial V2G operation that’s been running for four years, using fleet vehicle battery flexibility to provide frequency regulation services to grid operator Energinet to help it manage its wind-power-heavy grid. It's also aggregating EV charging in Spain and Portugal, said Marc Trahand, Nuvve’s executive vice president of marketing.
Nuvve raised an undisclosed amount of funding in a 2017 Series A round from EDF Renewable Energy, the clean power arm of French utility EDF and a partner in Nuvve's Denmark projects, and from Toyota Tsusho, the investment arm of Toyota Motor Corp. That funding allowed Nuvve to expand its work in Japan with Toyota, in Europe with EDF, and to target projects in France, Italy, Germany, Belgium and the U.K., Trahand said. In the United States, where regulatory structures are more problematic for V2G, Nuvve has continued providing frequency regulation to PJM and has been testing its technology with EVs and a campus microgrid at the University of California at San Diego.
“You’ve got to be realistic that not every car will be V2G,” Trahand said. However Nuvve makes its technology available for third parties to use in their own V2G operations and actively manages V2G flexibility to provide to utilities and grid markets. The company feels untapped battery capacity ican generate revenue that could help lower the costs of switching from fossil-fueled to battery-powered transportation.
Nuvve’s V2G project on Denmark’s Bornholm Island delivers about $2,000 per each 10-kilowatt connection annually. Trahand said Nuvve shares some of that revenue with the owners. The municipal vehicle fleet owner involved has multiyear contracts that provide “seamless operation for them," said Trahand in a September interview. "They have an application on their phones that tell us how far they need to drive in the next few days; our software takes that into account.”
“We lie in between the two industries here: the EVs and the utilities,” he said. “We plan to enable a lot of our partners to have vehicle-to-grid services, to enable utilities, enable charging station operators, enable automotive manufacturers.”
Nuvve is the latest U.S.-based EV-related company to go public via SPAC merger others include Nikola Motors and Fisker Automotive. Both have seen valuations climb into the billions of dollars since their public debuts, despite significant questions about their ability to compete with established auto brands.
On the EV charging front, U.S. market leader ChargePoint in September announced plans to merge with SPAC Switchback Energy Acquisition Corp. in a deal that would combine Switchback’s $317 million in cash held in trust with $225 million raised via private investment to yield about $493 million and value the company at $2.4 billion.