Editor’s Note: Updates with J.P. Morgan initiating coverage of Nikola
Hyliion Inc., a startup maker of diesel-electric truck components, expects to begin publicly trading its stock around the end of the third quarter following a merger with a “blank check” company created specifically to find a marriage partner with high-growth potential.
The path is practically identical to one followed by startup electric truck manufacturer Nikola Corp., which went public on June 4.
Tortoise Acquisition Corp. (NYSE: SHLL) was formed 15 months ago as a special purpose acquisition company (SPAC). It evaluated more than 200 companies before settling on Hyliion, which was founded in 2015.
In addition to $235 million that Tortoise invested from its own initial public offering, a sale of discounted shares raised $325 million in a private investment in public equity (PIPE) at $10 a share.
Shares on the move
Tortoise shares jumped on the June 19 merger announcement – from $10.22 to more than $18 in intraday trading Monday. The implied market capitalization of Hyliion is $1.5 billion.
The new company, which will be called Hyliion Holdings Corp., will trade as HYLN on the NYSE assuming the merger receives U.S. Securities and Exchange Commission (SEC) approval.
The SEC approval of the Nikola merger with VectoIQ lit the fuse to a huge run-up in the shares of VTIQ. Nikola shares rose 103.7% on June 8, their third day of trading. They traded intraday Monday at $66.70. Prior to the merger, a PIPE raised $525 million for Nikola in addition to $230 million that VectoIQ invested.
Separately, J.P. Morgan Chase became the first major Wall Street Bank to initiate coverage on Nikola with a $45 price target. Though it believes Nikola is a disruptive technology for the trucking industry, Chase said Monday the stock is fully valued.
Hyliion Holdings lacks the humor of