Aug 18 (Current News) - UK-based electric truck manufacturer Tevva has proposed a merger agreement with ElectraMeccanica to expand into the US and European markets.
The merger would focus on accelerating the expansion of Tevva’s electric medium and heavy-duty commercial vehicles, which according to the companies, is a target market expected to reach US$67 billion (£52 billion) in value by 2030.
Tevva currently utilises a 110,000-square-foot electric vehicle (EV) manufacturing facility, which is based in Tilbury, UK. Through the merger, this facility would be complemented by ElectraMeccanica’s recently commissioned 235,000-square-foot facility in Mesa, Arizona, which is expected to enable the combined company to scale its production to serve the UK, European and US markets.
It is important to note that although Tevva focuses primarily on battery-electric trucks, the company has also been exploring the use of a proprietary hydrogen range-extender technology.
Upon the closing of the proposed transaction, ElectraMeccanica, an EV designer and assembler, shareholders would own 23.5% of the combined company and Tevva shareholders would own 76.5%. The combined company expects to have a cash balance of between approximately US$70-80 million, with debt of approximately US$26 million.
David Roberts, current director of Tevva and the anticipated incoming executive chairman upon the closing of the proposed transaction, said: “Since Tevva’s founding more than ten years ago, we have focused our engineering and product development capabilities on developing a portfolio of zero-emission commercial vehicles that have generated significant customer interest.
“Our vehicles have undertaken more than 300,000 miles of testing and operating experience in real-world conditions by demanding fleet operators. We are excited to merge with ElectraMeccanica and accelerate the growth of the combined company.
“Throughout the process, we have been impressed with ElectraMeccanica’s management team and strongly believe that ElectraMeccanica’s complementary assets, skills and capital will further enhance our advantages in this large and rapidly growing market.”
The US trucking market could be one of the key drivers for decarbonisation in the US transportation sector with the American Trucking Associations (ATA) stating that there were approximately 3.6 million professional drivers in the States. According research released by employment website Indeed.com in March 2023, truck driving was the 22nd most common job in the US.
Interestingly, the US Government has previously said that although medium and heavy-duty trucks account for less than 5% of vehicles on US roads, they produce over 20% of the emissions from the transportation sector. The merger will look to tackle this issue and capitalise on this growing demand for medium and heavy-duty zero-emission vehicles.
Steven Sanders, chairman of the ElectraMeccanica board of directors, added: “By partnering with Tevva, we are providing our shareholders with a unique opportunity to participate in the accelerated and technology-driven growth prospects of the combined company in ways that also logically extend and leverage ElectraMeccanica’s existing assets and strengths.”
This article originally appeared on Current News