Arrival pushes ahead with second SPAC merger amid cost-cutting
Embattled electric vehicle company Arrival has ended the first quarter with $130m (£104m) cash following cost-cutting measures as it pushes ahead with a second merger with a special purpose acquisition company.
In April, the loss-making company said it will enter a business combination with Kensington Capital in a bid to raise as much as $283m (£226m).
Igor Torgov, Arrival CEO, said: “The merger with Kensington and their extensive manufacturing and automotive industry expertise validates Arrival’s strategy to bring a purpose-built Class 4 last-mile delivery vehicle to the US market.”
Money from the Kensington Capital merger would allow Arrival to move ahead with the construction of its Charlotte, North Carolina factory for the XL variant of its electric van.
Over at the startup’s Bicester, Oxfordshire facility the company has produced three of its L vans, with a further five on the way, the company said in a Q1 business update.
“Our top priority going forward is to facilitate a successful deal close later this year,” added Torgov.
Despite posting its results for Q1 of this year, Arrival is still to release its annual report for last year and was given another warning from the Nasdaq Stock Exchange.
“We are working diligently to complete and file our 2022 financials as soon as possible. We have not yet filed them,” Arrival told UKTN.
Arrival cited “the diversion of the attention of management and other personnel responsible” towards raising capital and “business combination transactions” as reasons for the delay.
Arrival, which was founded in Britain but listed on the US Nadaq exchange in 2021 through a merger with a special purpose acquisition company, is yet to report any revenue. It anticipates losses for 2022 to be as high as £840m.
It also went through a reverse stock split in order to remain on the Nasdaq.