Nikola Corporation, a five-year-old electric vehicle startup whose name shares the same origin as Elon Musk’s Tesla (Serbian-American inventor Nikola Tesla) but makes a starkly different product—cars that run on hydrogen fuel cells rather than lithium-ion batteries—is slated to go public on NASDAQ, the company announced Tuesday.
Nikola will make its market debut through a merger with a special-purpose acquisition entity called VectoIQ Acquisition Corp in a deal valued at $3.3 billion. (The IPO structure is similar to that of space tourism startup Virgin Galactic last October.) The combined company will keep the name “Nikola Corporation” and be traded under the ticker symbol “NKLA.”
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Nikola was most recently valued at $3 billion after raising a series D round led by European heavy-duty auto maker CNH Industrial. As part of the merger with VectoIQ, the company will receive $525 million in fresh equity funding from outside institutional investors, including Fidelity Management & Research Company, ValueAct Spring Fund and P. Schoenfeld Asset Management. Nikola said the investment will be used to expand its portfolio of vehicles build out a hydrogen charging station network in the U.S., a main bottleneck in commercializing hydrogen-powered vehicles.
“We are on a roll. You couldn’t ask for better news for the energy and tech industry,” Nikola founder and CEO Trevor Milton said in a statement on Tuesday. “The world is transitioning to zero-emission platforms and Nikola is the leader for heavy duty vehicles. We believe we have a differentiated business model built on economics, not government subsidies. We now need to double down and speed up the timelines and get to market.”
A serial entrepreneur, Milton founded Nikola in 2015 with personal funds from the sale of his previous company. Nikola has so far released three electric trucks—Nikola One, Nikola Two and Nikola Tre—all potential competitions to Tesla’s conceptual Semi truck. The company said it has secured more than 14,000 pre-orders from industrial clients, which represent over $10 billion in potential revenue and will keep the factory busy for at least 2.5 years.
“In our two-year quest to find a partner that was a proven technology leader and focused on making a global difference, Nikola was the clear winner. Nikola’s vision of a zero-emission future and ability to execute were key drivers in our decision,” Stephen Girsky, CEO of VectoIQ, said in a statement on Tuesday.
After the transaction closes, Girsky, a former General Motors executive, will join Nikola as a board member.