July 22, 2020 / 9:41 PM / 15 days ago

Electric bus maker Proterra considers deal to go public: sources

(Reuters) - U.S. electric bus manufacturer Proterra Inc is considering going public through a merger with a blank-check company, eschewing the traditional initial public offering that it explored last year, according to people familiar with the matter.

Burlingame, California-based Proterra would become the latest electric vehicle maker to merge with a special purpose acquisition company (SPAC), following in the steps of electric-truck startup Nikola Corp NKLA.O and car maker Fisker Inc. SPAC investors are placing bets on which startup might be the next Tesla Inc (TSLA.O).

Proterra, whose investors include car makers Daimler AG (DAIGn.DE) and BMW AG (BMWG.DE), has not ruled out an IPO or remaining private, the sources said. However, it has discussed a deal with several SPACs, said the sources, requesting anonymity as the negotiations are confidential.

Proterra did not immediately respond to a request for comment. The company was last valued at $1.1 billion in an August 2019 fundraising round, according to PitchBook data.

A SPAC is a shell company that uses IPO proceeds, together with debt, to acquire another company, typically within two years. Investors are not notified in advance what the SPAC will buy.

SPACs have emerged as a quick route to the stock market for companies concerned about the risk of the lengthy IPO process and which may struggle to attract interest from institutional investors such as pension funds.

Shares of the SPAC that is now Nikola are up more than 250% after the deal was announced in March. Earlier this month, Fisker agreed to be bought by blank-check company Spartan Energy Acquisition Corp (SPAQ_u.N) for $2.9 billion.

Also this month, autonomous vehicle technology firm Velodyne Lidar agreed to be bought by blank-check company Graf Industrial Corp (GRAF.N) for $1.6 billion.

Proterra was founded by mechanical engineer Dale Hill in Golden, Colorado, in 2004. Since inception, it has provided hundreds of public transport buses to U.S. cities and is expanding into school buses.

Reporting by Joshua Franklin in Pompano Beach, Florida, and David French and Rebecca Spalding in New York; Editing by Leslie Adler

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