Tevva to merge with US electric vehicle manufacturer ElectraMeccanica

A transatlantic merger between UK-based electric truck manufacturer Tevva and US electric vehicle designer and assembler ElectraMeccanica has been announced. The deal's strategic underpinning will enable Tevva to scale its production capabilities while setting its sights on the lucrative US market.

The joint statement from the two companies highlighted that the newly merged enterprise's initial focus would be the UK market, followed by penetrating the European and US markets. The ultimate objective is to establish a dominant presence as the "market leader" in the realm of zero-emission commercial vehicles.

Underpinning this ambitious endeavour, Tevva's 110,000sq ft EV manufacturing facility in Tilbury will synergise with ElectraMeccanica's 235,000sq ft facility in Mesa, Arizona. Both parties say this will allow them to efficiently scale production to cater to the demands of the UK, European, and US markets.

The merger, slated for completion in Q4 2023, is poised to expedite Tevva's US market entry and realise approximately $5m in annual cost savings by the close of 2024. As part of the collaboration, Tevva will gain access to a $6m credit facility from ElectraMeccanica, facilitating the swift delivery of Tevva's electric commercial vehicles to fleet customers.

Operating under the moniker Tevva Inc, the merged entity is anticipated to establish its headquarters in Delaware and trade on the Nasdaq stock exchange. Upon closure of the transaction, ElectraMeccanica shareholders will hold a 23.5% stake, while Tevva shareholders will secure a majority 76.5% ownership. The merged entity is expected to boast a cash balance ranging from $70m to $80m, offset by a debt of approximately $26m.

David Roberts, the current director of Tevva, poised to take on the role of executive chairman in the merged company, said: "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."

Susan Docherty, CEO of ElectraMeccanica and the anticipated CEO of the merged entity, added: "The complementary operations of the two companies and our similar values and mission give me complete confidence we can jointly create significant shareholder value."