Arrival is scrapping a merger with special purpose acquisition company Kensington Capital Acquisition Corp in the latest blow for the embattled electric vehicle company.
The two firms have cancelled the merger agreement set out in April, which would have been UK-founded Arrival’s second merger with a special purpose acquisition company (SPAC) after it listed on the US Nasdaq in 2021.
In a statement, Arrival said it “intends to redirect its focus towards advancing other opportunities”.
UKTN has reached out to Arrival for comment.
Now the company is enlisting investment banking firm TD Cowen and Teneo Financial Advisory for a “seamless transition” and “alternative avenues” to supply “additional liquidity”.
Arrival is yet to report any revenue and anticipates losses for 2022 to be as high as £840m.
Earlier this year is implemented cost-cutting measures, ending the first quarter with $130m (£104m) in cash.
Arrival had hoped the Kensington merger would unlock $283m of cash held in trust, before redemptions.
The EV company planned to use the liquidity boost to fund the construction of a North Carolina manufacturing base.
Commenting on the Kensington merger when it was first announced, Arrival’s CEO Igor Torgov said: “This transaction offers a potentially significant capital infusion and additional support in bringing our XL Van to market.”
Torgov added: “We are looking forward to partnering with Kensington to meet our production goals as we aim to commercialize our XL Van by the end of 2024.”