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UPDATE 1-Lordstown to restate 2020 results after SEC guidance on SPAC accounting

·1 min read

(Adds details on SEC guidelines, background)

May 11 (Reuters) - Electric pickup truck maker Lordstown Motors Corp said on Tuesday it would restate its previously issued 2020 consolidated financial statements, citing recent guidance from the U.S. Securities and Exchange Commission on accounting by special purpose acquisition companies.

The regulator in April issued guidance which called into question whether warrants issued by hundreds of SPACs could be considered equity instruments. The guidance suggests that many SPACs may have to refile their financial statements to account for the warrants as a liability.

The SEC in March had asked Lordstown for information related to its merger with blank-check company DiamondPeak Holdings and preorders of its vehicles.

"The restatement pertains to the accounting treatment for public and private placement warrants that were outstanding at the time of the business combination with DiamondPeak on Oct. 23, 2020," the company said in a statement on Tuesday.

Lordstown said it would restate its results for the year ended Dec. 31, such that some, if not all, of the warrants are accounted for as liabilities and marked-to-market each reporting period.

Separately, sensor maker Velodyne earlier said, as a result of the SEC guidelines, it had re-evaluated the accounting treatment of its warrants and concluded that certain warrants should have been classified as a liability measured at fair value. (Reporting by Sanjana Shivdas in Bengaluru; Editing by Shailesh Kuber)