Switchback Energy Acquisition To Merge With ChargePoint


Switchback Energy Acquisition has jumped over 50% in the last 5 days ahead of the merger with ChargePoint on Dec. 15th.

Switchback Energy Acquisition (symbol "SBE" on the NYSE) is another SPAC that will merge and take a start-up public. In this case Switchback Energy will undergo a reverse merger with ChargePoint in order to provide the latter company with funding for building EV-charging infrastructure. The continued growth of EVs in the US makes the company believe that demand will greatly increase for the chargers they profit off of. 

Based on the projections provided by the company we know it expects its sales to grow rapidly over the next five years. It projects a compound annual growth rate of 60% from 2021 to 2026. However, its EBITDA will not become positive until 2024 (believes that it will generate a cumulative EBITDA of -$357 million through 2023).

ChargePoint assumes that it will receive $450 million of net proceeds from the merger and it already is the EV charger leader with 73% of networked Level-2 chargers. ChargePoint can use the funding to hold that top position.

Switchback is one of the few SPACs I’ve recently covered that really looks very appealing to me. I think investors who want EV-infrastructure stocks in their portfolios should buy the shares.

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