Electric aircraft maker Archer to go public in $3.8 bln Moelis-backed blank check deal
Feb 10 (Reuters) - Electric aircraft startup Archer, whichis getting solid backing from United Airlines, will go publicthrough a merger with a blank-check company backed by investmentbanker Ken Moelis in a deal valued at around $3.8 billion.
The deal with Atlas Crest Investment Corp,announced on Wednesday, is expected to provide $1.1 billion ofproceeds to the company which makes electric aircraft withvertical take-off and landing.
Archer and Atlas Crest said the proceeds include a $600million private investment from United Airlines Holdings Inc, Ken Moelis and Mubadala Capital, the investment arm ofAbu Dhabi's state investor Mubadala Investment Co.
Separately, United Airlines said it would buy $1 billion ofArcher's aircraft, with an option to buy an additional $500million of aircraft, as part of its decarbonization efforts.
Palo Alto-based Archer was launched in May last year and isbacked by Marc Lore, former chief executive officer of WalmarteCommerce U.S. The company said it is developing an electricaircraft that can travel up to 60 miles at 150 miles per hour.
In December, United Airlines announced a multi-milliondollar investment in a project to remove carbon dioxide from theair as part of a plan to be 100% "green" by 2050.
A blank-check company, or a special purpose acquisitioncompany (SPAC), is a shell company that uses capital raisedthrough an initial public offering to buy a private firm,thereby taking it public. They have gained popularity as analternative to public markets for companies seeking to avoid atraditional IPO.
Moelis-led Atlas Crest raised $500 million in its IPO inOctober. The veteran banker founded investment firm Moelis & Coin 2007, since when it has advised on more than $3.5trillion worth of transactions. Moelis also served as thepresident of UBS Investment Bank.(Reporting by Niket Nishant in Bengaluru; Editing by MajuSamuel)
